The Australian logistics market was valued at USD 81.28 billion in 2021, and it is predicted to expand to USD 114.32 billion by 2027, with a 5.85 per cent annual growth rate (2022-2027). Increased investments in logistics infrastructure have helped enhance the country’s capacity, driving the market. The COVID-19 pandemic has resulted in a massive rise in parcel movements, particularly e-commerce deliveries, straining Australia Post’s present service model. Similarly, the freight and logistics industry had felt the effects across the country, notably during the epidemic, when there was a high demand for home delivery of food and medical supplies. The Australian government is a key player in the long-term planning, development, and management of transportation networks to meet Australia’s expanding freight needs. It is committed to producing a national freight and supply chain strategy to boost Australia’s freight and supply chain productivity and efficiency.
Market Trends to Watch:
Increasing Infrastructure Investments:
The Australian ICS Global logistics and warehousing industry is expected to be driven by government investment in infrastructure development of road, rail, air, and water transport facilities in the coming years. With AUD 70 billion allocated for transport infrastructure from 2014 to 2021 and AUD 75 billion for funding road and rail infrastructure from 2018 to 2027. New infrastructure projects authorized under the most recent budget are expected to support over 30,000 direct and indirect jobs. The Australian government also pledged an additional AUD 1 billion 2.5 billion local government investment fund and the AUD 15.2 billion commitment. The project will link Brisbane and Melbourne ports, allowing commodities to travel between them in as little as 24 hours. The project will cost AUD 10 billion and take ten years to complete.
Competitive Environment:
The country’s major corporations have adopted various modern technologies, such as warehousing management systems, automation, drone delivery, and the transportation management system, allowing for better planning and tracking facilities, resulting in increased productivity and increased value proposition. Due to many foreign firms and their fierce competition for market share, the market is moderately fragmented.
The market is being pushed by bulk freight:
Despite the worldwide recession brought on by COVID-19, Australian export values in Q1 2021 were only 0.7 per cent lower than in Q1 2020. However, this good performance is mostly due to record iron ore receipts, which increased by 65 per cent year on year to AUD 38 billion in Q1 due to high world prices and strong Chinese demand. Aside from iron ore, China’s products exports plunged 40% year over year in the first quarter. Compared to the previous year, Australia and Brazil’s combined iron ore shipments totaled over 20 metric tons in the first half of 2021.
Given the reduced cost of freight compared to other sources of high-CV coal, Japan, South Korea, and Taiwan have been important customers. While imports decreased year over year from January to September 2022 due to the pandemic, Australian Global logistics coal shipments to those countries increased significantly in 2021. Japan imported 82.3 million metric tons of coal in January-September 2021, with Australia accounting for 59.5 million metric tons.
Bottom Line:
Finally, the Australian logistics company marketplaces are becoming increasingly popular, with numerous current trends, and it is expected to be the greatest for the next five years. So these are the above-explained details about the Australian Logistics market, which is expected to reach $114.32 billion in 2027.