World Sea cargo ship
The growing global cross-border e-commerce market driving the LCL volume is one of the key factors driving the growth of the seafreight forwarding market.
The global cross-border e-commerce market was valued at USD 460 billion in 2017 and is expected to reach USD 1,265 billion during the forecast period.
The U.S. and China are the key contributing countries for the global cross-border e-commerce market.
The growing Internet penetration and rising purchasing power parity (PPP) across all the regions are contributing to the growth of the cross-border e-commerce market.
This growth is expected to influence the volume of seafreight worldwide positively.
LCL seafreight shipments are propelled by the rise in the number of small package shipments.
Moreover, vendors are planning to expand their service portfolio. Sea transportation is emerging as a preferred mode for e-commerce due to developments in infrastructure.
In addition, there is a rise in the use of intermodal freight transportation due to the cost advantages it offers for the shippers as compared to using a single mode of transportation.
The consolidation in the shipping industry leading to high freight cost and operational difficulties will challenge the seafreight forwarding market during the forecast period. The shift toward consolidation in the shipping industry is expected to continue during the forecast period.
Major shipping companies have formed alliances, thereby cutting down the excess capacity of vessels as well as lowering the cost of scrapping the ships lying idle in ports.
Such consolidations in the shipping industry will lead to an oligopolistic market, which may result in fewer options for freight forwarders to select from. This, in turn, will lead to an increase in freight rates.
Europe will account for 40% of the market’s growth during the forecast period.
The growing trade volume on European trade routes, increasing container port throughput, and the rising number of FTAs in the region will drive the seafreight forwarding market growth in Europe during the forecast period.
Market growth in this region will be faster than the growth of the market in other regions. Germany and UK are the key countries for the seafreight forwarding market in Europe. ■