Freight Forwarding Industry in South Africa 2024

This report on freight forwarders, who arrange the shipment of goods from origin to destination, includes information on the state of the industry with updates on trade volumes, key trends and issues, notable players and corporate actions. There is also information on international players and trends, and influencing factors such as the logistics crisis and technology and innovation.

The report includes profiles of 22 notable companies including Africa Global Logistics South Africa, Berry and Donaldson, DHL Global Forwarding SA, DSV South Africa, Kuehne and Nagel, Megafreight Services, Rohlig-Grindrod, Safcor Freight (Bidvest International Logistics), and Santova Logistics.

Introduction

• The freight forwarding industry co-ordinates over 80% of South Africa’s international trade.
• Trade is expected to grow over the next few years.
• Many local industry players are unlisted subsidiaries of foreign multinational logistics companies.
• South African freight forwarders have to deal with local issues that affect their activities and performance, such as the logistics crisis.
• The industry has to contend with events that disrupt international trade, such as conflicts and natural disasters like droughts, hurricanes and floods.

Market Trends

• Companies are continuously looking at ways to reduce their carbon footprint.
• To stay competitive, lower costs, save time, satisfy customer demands and improve their ability to foresee and respond to crises, freight forwarders are constantly adopting new types of technology.

Market Opportunities

• Specialising in a specific industry’s products.
• The implementation of the African Continental Free Trade Area agreement is expected to increase South Africa’s trade with the rest of the continent, which should provide opportunities for freight forwarders to grow their businesses.

Market Challenges

• International shipping lines are increasingly diversifying into other logistics segments. This means a single entity could handle the transportation of a shipper’s cargo from origin to destination. In cases where shippers arrange transportation directly with these entities, freight forwarders are not involved.
• South Africa’s logistics crisis is affecting its trade levels, and therefore freight forwarders’ performance.

Market Outlook

• Global merchandise trade volumes are expected to increase due to a recovery in demand for traded goods and global economic growth.
• The global freight forwarding industry is expected to expand at a relatively low rate to 2027.
• The local industry is expected to grow as a result of merchandise trade growth.
• Freight forwarders are experiencing growing pressure on margins, which is expected to worsen in the short term due to higher carrier rates and rising competition from other forwarders.
• Multinational freight forwarders are expanding their operations in Africa as the continent’s trade is expected to grow faster than the world average.