Market Trends of Qatar Third-Party Logistics (3PL) Industry
This section covers the major market trends shaping the Qatar Third-Party Logistics (3PL) Market according to our research experts:
eCommerce Sector Driving the Market Growth
Qatar's e-commerce market is developing and was expected to exceed QAR 11.7 billion (USD 3.2 billion) by 2022 compared to QAR 4.7 billion (USD 1.3 billion) in 2017. Over 350 e-commerce websites have been registered with the Ministry of Transport & Communication (MOTC) so far. The development of the sector has many reasons. Qatar has one of the world`s highest internet adoption rates and ranks among the top countries in terms of acceptance of information and communication technologies (ICT). The e-commerce penetration rate in the country increased from 15% in 2018 to 37% in 2019. The outbreak of Covid-19 has forced many clients and consumers to opt for e-commerce platforms and banks to launch new products and services to enable businesses to maintain their operations. Many retail outlets, start-ups, scale-ups, and small and medium-sized enterprises (SMEs) have explored social media platforms to advertise their products and services to attract more clients and boost sales.
The Ministry of Communications and Information Technology (MCIT) is helping develop e-commerce in Qatar by establishing regulations and requirements to be trusted and has introduced several initiatives to support ideas of entrepreneurs in the field of e-commerce. MCIT has developed the eCommerce Guidelines to guide and help Qatar's eMerchants understand and achieve eCommerce best practices. Theqa is Qatar's e-commerce trustmark, is an active programme that will certify local online merchants based on a set of identified criteria and monitor its members adherence to the code of conduct. It empowers consumers and companies to quickly and safely grow the local e-commerce market. There are a total of 269 certified eMerchants. In Qatar, there are three types of service providers in the e-commerce system: eCommerce Website Services, Payment Gateways & Payment Solutions, Logistics Providers. The e-commerce market is showing a significant growth rate in the country widening its opportunities in business sectors to expand further. Qatar is claimed to be one of the largest e-marketplaces in the Middle East and North Africa. With the growth of e-commerce in Qatar, the need for additional high-value services is also increasing. Online business owners are increasingly outsourcing professionals in areas as diverse as fulfillment, delivery, web hosting, technical support, website development and design, customer service, and administrative support.
Plans to Raise LNG Output Creating Opportunites in the Market
Qatar has plans to raise the country's LNG production capacity to 126 million tons per annum (mtpa) by 2027, marking a 64% increase from the current 77 mtpa, according to the Minister of State for Energy Affairs and President and CEO of Qatar Petroleum. In July 2022, QatarEnergy signed a deal with Shell for the Gulf state's North Field East expansion, the first phase of the world's largest liquefied natural gas (LNG) project, following agreements with TotalEnergies , Exxon , ConocoPhillips and Eni. Shell will take a 6.25% stake in the North Field East expansion project, TotalEnergies and Exxon will also hold 6.25% stakes. In all, the expansion plan includes six LNG trains that will ramp up Qatar's liquefaction capacity to 126 million tonnes per annum (mtpa) from 77 by 2027. This expansion plan will lead to a major boom in the maritime transport and logistics services industry in the country,
Many developments have already been achieved during the past few years, including the opening of Hamad Port and the start of operating new navigation lines with several countries in the world and the establishment of integrated logistics areas. In November 2022, QatarEnergy and China Petroleum & Chemical Corporation (Sinopec) have entered into a 27-year sale and purchase agreement (SPA) for the supply of 4 million tons per annum (mtpa) of liquefied natural gas (LNG) to China. The contracted LNG volumes will be supplied from QatarEnergy's North Filed East (NFE) LNG expansion project and will be delivered to Sinopec's receiving terminals in China. In August 2022, Malaysian energy logistics group MISC Berhad and its consortium partners - shipping companies Nippon Yusen Kabushiki Kaisha (NYK), Kawasaki Kisen Kaisha (K-Line) and China LNG Shipping (Holdings) Limited (CLNG) - have been awarded long-term time charter contracts by Qatar's state-owned oil and gas company QatarEnergy for seven newbuild liquefied natural gas (LNG) carriers. Such developments show the growth of LNG sector in Qatar is ongoing. This ongoing growth will create opportunities for 3PL service providers in the market.
