The UAE Freight Forwarding market has grown significantly over the past few years owing to the increasing external trade activities in the country. Freight forwarding services help organizations transport goods internationally through air, ocean or road transport. Services provided include customs clearance, track and trace capabilities, transportation up to the destination, warehousing and distribution. The UAE is a major trading hub in the Middle East owing to its strategic geographic location and well-developed transportation infrastructure.
The UAE Freight Forwarding Market is estimated to be valued at USD 20.11 Bn in 2024 and is expected to reach USD 30.19 Bn by 2031, growing at a CAGR of 7.01% from 2024 to 2031.
Key Takeaways
Key players operating in the UAE Freight Forwarding market are DHL Global Forwarding, DB Schenker, CEVA Logistics, Emirates SkyCargo, and Aramex. DHL Global Forwarding is one of the leading players offering air, ocean and road freight services.
DB Schenker provides integrated logistics solutions across 170 countries. CEVA Logistics offers customized supply chain solutions globally. Emirates SkyCargo is the cargo division of Emirates operating an extensive freighter network. Aramex is a major provider of transportation and logistics services within the country.
The UAE Freight Forwarding Market is witnessing high growth owing to increasing trade volumes in the UAE. Major trading partners include China, India, USA and European nations. Growth in sectors such as oil & gas, manufacturing and construction have augmented demand for freight forwarding services. Emerging technologies such as blockchain, IoT and automation are helping improve efficiency, visibility and reducing costs.
Market Trends
Increased adoption of multi-modal transportation: Forwarders are increasingly relying on multi-modal solutions involving air, ocean and road freight to efficiently transport goods internationally. This ensures lowest transit time and costs.
Growing demand for value-added services: There is higher demand for value-added services such as packaging, labeling, warehousing and distribution among importers and exporters. This is diversifying revenue streams for freight forwarders.
Market Opportunities
Potential for cross-border e-commerce growth: Growth of e-commerce and rising consumer demand for overseas goods presents opportunities for freight forwarding of smaller consignments.
Fast emerging markets: Countries within the GCC and Middle East present substantial growth potential for freight forwarding owing to rising intra-regional trade.
Impact of COVID-19 on UAE Freight Forwarding Market Growth
The COVID-19 pandemic has significantly impacted the UAE freight forwarding market. During the initial phases of the pandemic in early 2020, movement restrictions caused supply chain disruptions and declined trade activities thereby impacting market growth negatively. Freight volumes dropped sharply as export and import shipments were halted or delayed. Social distancing mandates also affected warehousing and distribution operations. However, with time governments and logistics firms adapted swiftly to the changing scenario. The adoption of digital technologies increased for contactless freight handling and tracking. Demand for freight forwarders rose again as exports of medical supplies and essential goods to other affected regions gained momentum. Post-lockdowns, economic activities resumed and international trade regained lost grounds at a faster than expected pace. Freight volumes rebounded strongly in late 2020 and throughout 2021 indicating V-shaped recovery. Going forward, continued vaccination drives and easing of travel rules are expected to facilitate cross-border trade flows. Investments in automation, cold chain infrastructure and last mile delivery networks will further aid industry's growth. While risks of subsequent waves persist, the freight forwarding sector is better equipped now to tackle future disruptions.
Geographical Regions with Highest UAE Freight Forwarding Market Value
In terms of market value, Abu Dhabi and Dubai account for over 60% share of the total UAE freight forwarding industry. Being the economic epicenters, these emirates handle the bulk of export-import cargo through their ports and airports. Abu Dhabi Ports, Dubai Ports World and Emirates SkyCargo are some of the major logistics players based here. Other northern emirates like Sharjah and Ajman are also important hubs owing to their industrial activities and connectivity via road and sea routes. Going forward, expected infrastructure expansions in Fujairah, Ras Al Khaimah and Al Ain will boost trade and decentralized development. This will aid wider geographical dispersion of freight forwarding activities across the UAE in coming years.
Fastest growing region for UAE Freight Forwarding Market
Africa region is poised to be the fastest expanding market for UAE's freight forwarders. Over the past decade, bilateral trade between UAE and African countries has grown manifold driven by UAE's 'Look Africa' policy. Establishment of shipping lines and charter flights connecting Emirati ports with major African economies has strengthened transportation networks. Rising consumerism, foreign investments and reconstruction activities are also propelling freight demand from Africa. With ongoing mega projects under Belt and Road Initiative, trade collaboration with East African nations like Ethiopia, Sudan and Djibouti is expected to witness strong gains going ahead. This will allow UAE freight forwarders to tap into new high growth opportunities on the African continent.
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