Market Trends of Australia 3PL Industry
Increase in Manufacturing exports
A significant source of demand for logistics services is the manufacturing division. Businesses' confidence in the ability of third parties to manage their stocks has been enhanced by the development of advanced inventory tracking and monitoring systems throughout supply chains. In 2023, the manufacturing sector contributed 20 % of domestic demand, followed by TP&W at 51%.
Machinery and equipment manufacturing, which will add 161,700 square meters to warehouse demand by 2023, is the most significant contributing subsector of industry in production. Transport equipment manufacturing took 61,800 sqm of space, and food product manufacturing demand accounted for 52,900 sqm.
The rise in international trade increases exports and imports, with total goods and services exports increasing from USD 149,786m (29%) to USD 668,940m. The total imports of goods and services increased by USD 127,754 million or 33% to USD 513,210 million.
An Economic Cooperation and Trade Agreement was signed between India and Australia in 2022. From January to August 2023, India's exports to Australia increased by 14% yearly, amounting to 5.87 billion dollars. However, from April to November 2023, imports from Australia to India fell by 19% annually to USD 11.15 billion, mainly due to a fall in demand for coal, coke, and briquettes in India.
Australia's road freight dominates the market
Australia's road freight sector is considered a vital component of the nation's economy. Because of this, most businesses nationwide can receive much-needed support, not least because it plays a crucial role in the economy. The growth of Australia Road freight transport over the years is driven by increasing domestic and international trade, e.g. a boom in online shopping and an urgent need for efficient logistics solutions.
Across Australia, demand for next-day and same-day delivery has soared to record levels. Parcel delivery volumes increased by 25% in the 1st quarter of fiscal year 2024 compared to the preceding corresponding period. In addition, a 47% increase in same-day metro deliveries, indicating a significant shift in consumer preferences, was observed.
Rigid and articulated trucks dominate intercity merchandise freight on the Australian market, as these vehicles represent the fastest, cheapest, and most convenient option for many clients. In cities, light commercial vehicles are the dominant form of transport for the final delivery stage. A substantial rise in the total value of merchandise trade has supported demand for road freight transport.
