Chemical Logistics Market is Anticipated to Witness High Growth Owing to Rising Pharmaceutical Industry Requirements

Chemical Logistics Market is Anticipated to Witness High Growth Owing to Rising Pharmaceutical Industry Requirements

The industry provides tailored supply chain solutions such as inventory management, warehousing, transportation management, and value-added services including repackaging and blending. The global growth of end-use industries such as pharmaceuticals and healthcare, electronics, agriculture, oil and gas, and manufacturing has expanded the demand for chemicals, thereby augmenting the chemical logistics market. The pharmaceutical industry in particular has witnessed rapid development of new drugs and treatments over the past few years, increasing the need for reliable and safe transportation and storage of raw materials and finished products.

The Global Chemical Logistics Market is estimated to be valued at US$ 397.48 Bn in 2024 and is expected to exhibit a CAGR of 5.0% over the forecast period 2024 to 2031.

Key Takeaways

Key players operating in the Chemical Logistics market are A&R Logistics, Agility Logistics, Al-Futtaim Logistics, BASF, BDP International, Inc., BDtrans, C.H. Robinson Worldwide Inc., CEVA Logistics, Deutsche Bahn (DB) Schenker, Deutsche Post AG (DHL), DHL, Montreal Chemical Logistics, Petochem Middle East, Rhenus Logistics, Ryder System Inc. These players are focusing on partnerships and acquisitions to expand their service offerings and global footprint.

Significant opportunities exist in the pharmaceutical Chemical Logistics Market Size  segment driven by demand for temperature-controlled transportation and storage of drugs and biologics. Countries with rising healthcare expenditures such as India and China are expected to provide lucrative opportunities for logistics players.

Key players are strategizing global expansions to leverage the growing pharmaceutical industries in emerging markets. For example, DB Schenker acquired Indian logistics firm Spear to provide end-to-end supply chain solutions in South Asia. CEVA expanded its network in China through new facilities.

Market Drivers
Growth of the global pharmaceutical industry has been a major driver of demand for specialized chemical logistics services. In particular, the rapid development of biologics and cell and gene therapies require temperature-controlled transportation and storage of drugs, driving demand. According to industry estimates, the global pharmaceuticals market is projected to reach over $1.5 trillion by 2030.

Market Restraints
Stringent transportation regulations for hazardous chemicals pose a challenge for logistics providers and increase costs. Players must comply with industry standards for safety, documentation, hazard communication and emergency response training. IMDG codes specify requirements for dangerous goods transport by sea. Non-compliance can lead to delays, penalties and loss of customers. These regulatory hurdles restrain the growth and globalization of chemical logistics market to some extent.
Segment Analysis

Road transportation dominates the chemical logistics market as it is cost effective for transporting chemicals over shorter distances within a country or region. This segment is majorly used for domestic transportation of chemicals. It accounts for over 45% of the overall chemical logistics market share as heavy trucks can efficiently handle bulk volumes of chemicals over land. Rail transportation is the second largest segment and is preferred for transporting chemicals across long distances both domestically and internationally. It is ideal for transporting bulk volumes of chemicals across nations and continents in an environment friendly manner. Key factors such as lower transportation costs per ton-km and ability to carry bulk volumes drive the growth of this segment.

Global Analysis

The Asia Pacific region dominates the global chemical logistics market and is expected to grow at the fastest rate during the forecast period. This can be attributed to the presence of large chemical industries and an increasing domestic demand for chemicals from major economies such as China, India, Japan and South Korea. Furthermore, initiatives such as Made in China 2025 are supporting the growth of the domestic chemical industry. Factors such as rapid industrialization, growing polymer industry and expansion of chemical trade between Asia Pacific nations are driving the market in the region. Europe is another major market for chemical logistics due to stringent environment laws and emphasis on safe transportation of chemicals. Countries like Germany have major chemical industries and an established logistics infrastructure to transport chemicals effectively.

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Ravina Pandya, Content Writer, has a strong foothold in the market research industry. She specializes in writing well-researched articles from different industries, including food and beverages, information and technology, healthcare, chemical and materials, etc. (https://www.linkedin.com/in/ravina-pandya-1a3984191)