Chemical Logistics Market Size 2024-2028

The Global Chemical Logistics Market size is estimated to grow by USD 67.7 billion, at a CAGR of 4.36% between 2023 and 2028. The market growth is driven by factors such as the expanding chemical industry, the adoption of multimodal transportation, and investments in port infrastructure. This growth is further driven by the need for efficient transportation of raw materials and finished products. Additionally, the optimization of logistics operations enhances supply chain efficiency, contributing to the market's expansion.The market operates at the intersection of liquid and solid states, catering to diverse sectors like shale gas, energy, and food production. With a focus on environmental sustainability, it navigates challenges like contamination and spoilage while meeting stringent federal and state regulations. Collaborations between industry giants like Agility Logistics and the American Chemistry Council drive innovation, integrating IoT devices and intelligent cloud platforms for enhanced efficiency. These developments ensure reliable, safe, and efficient transportation of chemical products globally, meeting the evolving demands of the industry.

What will the Size of the Market be During the Forecast Period?

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Market Dynamics and Customer Landscape

 Warehousing emerges as a critical component, ensuring safety and mitigating safety hazards. Tech-driven logistics services further streamline operations, addressing the unique needs of industry verticals, including pharmaceuticals, cosmetics, and specialty chemicals. Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

Key Market Drivers

The demand is driven by the growth of the global chemical industry. During 2016-2030, sales of the chemical industry across the world are expected to register a growth rate of 3.85%. In 2019, global chemical production grew by 2.7% compared with 2018. The growth rate of the chemical industry is also driven by the fall in crude oil prices, as most chemicals are obtained from the refining of crude oil. The average price of crude oil fell from over USD 64.90 per barrel in 2018 to USD 57.05 per barrel in 2019, and the demand for naphtha increased as it accounted for 50% of the feedstock in the petrochemical industry.

Moreover, the growth of the chemical industry across the globe will drive the market. The shift of the industry to emerging Asian countries is likely to fuel market growth. For instance, the global sales of chemicals in Asia account for the largest share of chemical sales across the globe due to the presence of many emerging economies such as China, India, Singapore, Malaysia, and Vietnam. Chemical sales are expected to grow in Asia. By 2030, chemical sales in Asia will account for 64.60% of global chemical sales. This shift of chemical industries to Asian countries will strengthen the market during the forecast period.

Significant Market Trends

One of the key trends emerging in the global market is the increased demand for large-capacity sea vessels. High-end sea vessels are characterized by ample dock space, increased storage capacity, high engine capacity, and high bollard pull. These large-sized vessels use the latest technology, such as a controllable pitch propeller. These large-sized vessels use the latest technology and have a higher utilization rate. Their load handling capacity is also high; hence, they can transport larger quantities of chemicals in one go, reducing logistics costs.

Moreover, the capacity of container shipping grew by 3.5%-3.7% in 2018 due to the expansion project of the Panama Canal and Suez Canal. The increased demand for the 40 ft containers in the global chemical sea transportation market will also drive the market.

Major Market Challenges

The high cost of operations and capital-intensive business is the major challenge impeding market growth. The construction of a new chemical warehouse and storage facility is a highly capital-intensive task and requires complying with a wide range of specifications and obtaining certifications. In addition, the operational and maintenance costs of warehouses are very high. The warehousing sector is attracting various investments owing to the increasing demand for warehousing solutions. However, the successful and optimized operation of warehouses is a critical task.

Appropriate financial modeling, demand mapping, and infrastructure analyses are some of the key aspects required for a feasible and efficacious warehouse and storage facility. Since the capital involved in the manufacturing and setting up of a warehouse is irreversible, the period required to receive the return on investment is long. Therefore, the high cost involved in setting up and operating a warehouse and managing inventory loss is expected to limit the growth of the market during the forecast period.

Customer Landscape

The market research and growth report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.

Market Customer Landscape

Market Segmentation

The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.

• Service Outlook 
  • Transportation
  • Warehousing
  • Others

• End-user Outlook 
  • Chemical industry
  • Pharmaceutical industry
  • Specialty chemical industry
  • Others

• Region Outlook 
  • APAC
    • China
    • India
  • North America
    • The U.S.
    • Canada
  • Europe
    • U.K.
    • Germany
    • France
    • Rest of Europe
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa
  • South America
    • Brazil
    • Argentina

By Service Industry Segmentation

Based on service, the market is segmented into transportation, warehousing, and others. The market share growth of the transportation segment will be significant during the forecast period. A rise in intra-regional trades and distribution of chemicals, as well as the relocation of manufacturing facilities to countries such as Brazil, China, India, Mexico, and South Africa, where labor costs are low, is spurring the demand for both domestic and international chemical transportation logistics. An increase in free trade agreements and the formation of a trade bloc between countries are also driving the demand for transportation services across the world.

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The transportation segment was the largest and was valued at USD 95.30 billion in 2018. For the providers, road transportation offers advantages such as last-mile delivery and higher flexibility. The increased expenditure on road infrastructure will strengthen the use of the road for transporting chemicals. For instance, the national highway network in India is expected to grow to 50,000 km by 2019. The development of a road highway network between 32 Asian countries will also facilitate chemical transportation by road. Chemicals are transported by sea using tank containers, sea tankers, barges, intermediate bulk containers, and flex tanks. An increase in the global port and terminal handling operation due to an improved port capacity and increased efficiency at ports while reducing the turnaround time at the harbour will enhance the use of the sea as a mode to transport chemicals.

Regions Analysis 

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APAC is projected to account for 62% of the global market share by 2024. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. APAC is growing at the fastest rate in the global market compared with other regions. Factors such as low cost of labor, manufacturing expenses, and high consumer base enable foreign and domestic investors to plan their future projects and investments in this region. The growth of the logistic parks and logistics space in APAC is driving the global third-party logistics (3PL) market in the region. The top seven economies cumulatively hold more than 1.5 billion square meters of gross floor area.

Who are the Major Market Companies?     

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

Schneider National Inc. - The company offers chemical logistics such as supply chain, transportation, and delivery under the logistics segment as its key offerings. It also offers non-asset freight brokerage, supply chain (including 3PL), and import/export services under its services segment.

The report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:

• Agility Public Warehousing Co. K.S.C.P
• BASF SE
• BRENNTAG SE
• C H Robinson Worldwide Inc.
• CMA CGM SA
• CSX Corp.
• CT Logistics
• Deutsche Bahn AG
• Deutsche Post AG
• Dow Inc.
• DSV AS
• FedEx Corp.
• Kintetsu Group Holdings Co. Ltd.
• North West Carrying Company LLP

Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.

Market Analyst Overview

In the market, the synergy between vehicle manufacturing, engineering, and the government of India influences efficient transportation and storage. Leveraging an intelligent cloud platform, logistics companies manage the intricate supply chain of the specialty chemicals warehousing and storage industry, ensuring safe handling in both liquid and solid states while complying with federal regulations. Workers in this sector play a pivotal role, ensuring the safety of dangerous chemicals during transportation & distribution. Collaboration with Ryder System Inc. and other third-party chemical logistics companies optimizes storage & warehousing while addressing the complexities of the rail network and road quality. Advanced technologies like IoT-enabled connected devices, smart sensors, and robotics enable automation and enhance sustainable business operations. With a focus on green warehouses and drone delivery, the industry evolves to meet the demands of the oil & gas industry and process industries, prioritizing safety and efficiency under the scrutiny of the Pollution Control Board (PCB).

in addition, the confluence of the smart energy industry and environmental problems underscores the need for responsible handling of chemical demand and manufacturing. Companies specializing in pharmaceutical manufacture and cosmetic industry rely on efficient logistics to manage diverse chemical volumes in both liquid and solid states. Challenges such as OEM shutdowns in automobile manufacturing impact supply chains, necessitating collaboration with chemical logistics companies like A&R Logistics and Rhenus Logistics. Utilizing IoT-enabled connected devices and Artificial Intelligence (AI), these companies optimize routes across airways, roadways, railways, and waterways, mitigating risks such as pilferage and ensuring customs & security compliance. Advanced technologies like machine learning and driverless vehicles revolutionize the industry, promoting green logistics and enabling seamless transportation of finished chemical products for diverse end use industries.

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What are the Key Data Covered in this Market Research Report?

• CAGR of the market during the forecast period.
• Detailed information on factors that will drive the market growth and forecasting between 2024 and 2028
• Precise estimation of the market size and contribution of the market in focus on the parent market.
• Accurate predictions about upcoming trends and changes in consumer behavior.
• Market growth analysis across APAC, North America, Europe, the Middle East and Africa, and South America.
• A thorough analysis of the market’s competitive landscape and detailed information about companies.
• Market forecasting of factors that will challenge the growth of the key market companies.

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