Australia Freight and Logistics Market SIZE & SHARE ANALYSIS - GROWTH TRENDS & FORECASTS UP TO 2030

Australia Freight and Logistics Market Analysis

The Australia Freight and Logistics Market size is estimated at 99.08 billion USD in 2025, and is expected to reach 122.7 billion USD by 2030, growing at a CAGR of 4.38% during the forecast period (2025-2030).

The Australian freight and logistics industry is undergoing significant transformation driven by substantial infrastructure investments and modernization initiatives. The Australian government has committed USD 120 billion in land transport infrastructure development over the next decade through 2031, focusing on enhancing connectivity and efficiency across the nation's logistics network. This comprehensive investment strategy encompasses various individual funding programs developed in collaboration with state and territorial governments. The infrastructure development pipeline includes critical projects such as the Western Sydney International Airport, scheduled for completion by 2026, and the expansion of the Hobart Airport Terminal, for which the federal government has pledged USD 60 million specifically for runway and airfield facility upgrades.

The industry is witnessing a strong push toward sustainability and green logistics solutions. In early 2023, the government launched the USD 20 million Hume Hydrogen Highway initiative in partnership with Victoria, which will establish four hydrogen refueling stations between Sydney and Melbourne to support hydrogen-powered trucks by 2025. Additionally, the Australian Renewable Energy Agency (ARENA) has provided a USD 20 million grant to support Team Global Express's 'Depot of the Future' project, facilitating the deployment of 60 new electric trucks for metropolitan deliveries. These initiatives demonstrate the industry's commitment to reducing emissions while maintaining operational efficiency.

Major Australian logistics companies are increasingly investing in automation and technological advancement to enhance operational efficiency. DHL Supply Chain's planned investment of USD 101.86 million over the next two years in automation and robotics, including the deployment of 1,000 new assisted picking robots by 2025, exemplifies this trend. This technological transformation is reshaping traditional freight logistics operations, improving productivity, and addressing labor challenges while meeting the growing demand for faster and more efficient delivery services.

The maritime and air freight transportation sectors continue to play crucial roles in Australia's logistics industry landscape. Melbourne Airport has established itself as Australia's premier airfreight hub, handling 40% of the country's exports in Q1 2024, with significant volumes in fresh meat exports and pharmaceutical shipments exceeding USD 175.47 million in value. Similarly, the Port of Brisbane has emerged as Queensland's largest seaport and Australia's third-busiest port, processing over 28 million tons of cargo annually through 2,600 ships. These developments highlight the critical role of multi-modal transportation infrastructure in supporting Australia's domestic and international trade operations.

Australia Freight and Logistics Market Trends

Australia invested USD 120 billion in infrastructure projects, focusing on nation-building and land transport projects

• The Australian Government remains resolutely dedicated to a 10-year infrastructure pipeline (till 2032) valued at USD 120 billion, focusing on delivering land transport projects that hold national significance and contribute to shaping the nation's future. The 2023-24 budget represented a stride forward in establishing an infrastructure investment pipeline integral to nation-building endeavors. This initiative formed the bedrock for constructing a sustainable and credible lineup of projects, selected based on diverse economic and societal goals, encompassing regional connectivity, quality of life enhancement, and safety enhancement.
• Till 2028, USD 11.8 billion will be spent on new rail and transport projects in Western Australia, as part of the state’s USD 42.4 billion infrastructure investment. The 2024-25 State Budget includes USD 4.8 billion for the METRONET program, with USD 2.9 billion from the Commonwealth Government. This budget adds USD 254 million for METRONET, with the Morley-Ellenbrook Line set to finish by the end of 2024, and three more major rail projects the Victoria Park-Canning Level Crossing Removal, Byford Rail Extension, and Thornlie-Cockburn Link expected in 2025.

Tightening global oil markets and the weakening Australian dollar led to an increase in fuel prices in Australia

• In March of 2024, retail petrol prices in Australia’s five largest cities were lower, averaging 193.2 cents per litre (USD 1.93), down from 194.9 cpl (USD 1.94) in Q4 of 2023. However, daily average prices hit a new high in April. Among the cities, Perth saw the biggest drop (4.1 cpl), while Brisbane's prices increased by 1.4 cpl, making Brisbane the highest at 200 cpl (USD 2). In April 2024, although average retail petrol prices in Australia were not at their all-time highest when adjusted for inflation, recent international and geopolitical events have kept petrol prices relatively high.
• Australia's federal government will introduce a new fuel efficiency standard for passenger and light commercial vehicles starting January 1, 2025. This follows a one-month consultation period before drafting the new laws. Announced as part of the 2023 budget and linked to the EV strategy released in April 2023, the standard sets average CO2 targets for vehicle manufacturers. These targets will gradually decrease, requiring the production of more fuel-efficient and low or zero-emissions vehicles.

OTHER KEY INDUSTRY TRENDS COVERED IN THE REPORT

• Australia's population is growing due to the country's positive net overseas migration rate
• Australia is expected to strengthen the mining sector in line with its Critical Minerals Strategy 2023–2030
• Generative AI is anticipated to contribute between USD 3 billion and USD 9 billion annually to the retail sector by 2030
• Labor shortage, high freight costs, and rising global crude oil demand increased producer and consumer prices
• E-commerce in Australia is expected to register a CAGR of 10%, supported by the rise in social commerce and BNPL services
• The Australian government is investing USD 10.18 billion to support Australia's manufacturing industry
• Australian agriculture industry aims to become a USD 100 billion industry by 2030 to boost exports
• Imports from India are expected to increase supported by a 100% tariff-free agreement from the start of 2026
• Rising fuel costs, increasing charges, and toll costs are leading to increased operational costs
• The Australian trucking industry is transitioning its fleet to achieve the government's aim of net-zero emissions by 2050
• Australia's LPI Rank drops to 19 in 2023, with a focus on trade diversification and digital transformation for economic growth
• June 2024 truck sales dropped 14.8% but remained the second-highest June on record, reflecting the effects of the economic slowdown
• Rising focus on development of land infrastructure both road and rail witnessed, to promote Australia's economic growth
• Government initiatives, capacity expansion investments, and increasing sea freight trade are driving growth
• Enhancing port connectivity is key to Australian trade with Port of Melbourne, the Port of Sydney, and the Port of Brisbane being top ports
• Delayed shipments and rapidly increasing freight rates are affecting Australian international container ports and container trade
• Increased fuel prices impacted pricing costs in 2023, with fuel price declines witnessed in 2024
• Road freight demand is leading the industry, followed by rail freight, supported by infrastructure development
• Australian Infrastructure Plan aims to drive economic growth with an investment of USD 237 billion in pipelines

Segment Analysis: End User Industry

Wholesale and Retail Trade Segment in Australia Freight and Logistics Market

The Wholesale and Retail Trade segment dominates the Australian Freight and Logistics Market, commanding approximately 34% market share in 2024. This segment's prominence is largely driven by the booming e-commerce sector, which is expected to reach USD 42.7 billion by the end of 2024. The rise in retail trade has been particularly notable, with June 2024 showing a 2.9% increase compared to June 2023. The segment's growth is further supported by the increasing adoption of online shopping, with over 80% of Australian households now opting for digital purchases. The retail sector's expansion is also evident in the total retail turnover, which reached approximately USD 278 billion in 2023, marking an increase of over USD 9 billion from the previous year. Additionally, the food and meal delivery market, valued at USD 680 million per month, continues to be a significant driver within this segment.

Manufacturing Segment in Australia Freight and Logistics Market

The Manufacturing segment is experiencing the highest growth trajectory in the market, with a projected growth rate of approximately 5% from 2024 to 2029. This robust growth is primarily driven by the Australian government's significant investment initiatives, including a USD 725.58 million investment fund to support advanced manufacturing. The sector is witnessing substantial technological advancements, with smart factories becoming increasingly prevalent in 2023, featuring real-time monitoring and agile operations. Manufacturer lead times have notably improved, showing a 55% reduction since the end of 2023, dropping to just 14 days on average as of June 2024. The government's commitment to establishing a USD 10.18 billion financing vehicle for the manufacturing industry, with USD 0.67 billion specifically targeted for advanced manufacturing, is expected to further accelerate this segment's growth. The initiative also includes USD 1.01 billion for medical manufacturing and USD 0.67 billion for critical technologies, including AI and robotics applications.

Remaining Segments in End User Industry

The market's remaining segments include Oil and Gas, Mining and Quarrying, Construction, and Agriculture, Fishing, and Forestry, each contributing uniquely to the overall market dynamics. The Oil and Gas, Mining and Quarrying segment maintains its significance through extensive export operations and domestic distribution networks. The Construction segment's impact is reinforced by ongoing infrastructure developments and government investments in transportation projects. The Agriculture, Fishing, and Forestry segment continues to play a vital role in the market, particularly in regional areas, supported by the National Farming Federation's ambitious goals and significant investments in transportation infrastructure. These segments collectively contribute to the market's diverse portfolio, each serving specific industrial needs and regional requirements while maintaining strong logistics networks throughout Australia.

Segment Analysis: Logistics Function

Freight Transport Segment in Australia Freight and Logistics Market

The Freight Transport segment maintains its dominant position in the Australian Freight and Logistics market, commanding approximately 45% market share in 2024. This segment's strong performance is driven by significant government investments in transport infrastructure, including a USD 120 billion commitment over 10 years until 2031 for land transport development. The segment's growth is further supported by the increasing adoption of sustainable transport solutions, exemplified by initiatives like the USD 20 million Hume Hydrogen Highway project connecting Sydney and Melbourne. Additionally, the segment benefits from robust multimodal integration across road, rail, sea, and air transport networks, with particular emphasis on enhancing connectivity between major ports and inland transportation hubs. The freight logistics industry is thus poised for continued expansion.

CEP Segment in Australia Freight and Logistics Market

The Courier, Express, and Parcel (CEP) segment is experiencing remarkable growth, projected to expand at approximately 5% CAGR from 2024 to 2029. This accelerated growth is primarily driven by the booming e-commerce sector, with Australia's online retail market expected to reach USD 54.68 billion by 2027. The segment's expansion is further supported by significant technological advancements, such as CIRRO E-Commerce's launch of new cross-border shipping services from Australia to various international destinations in 2024. The implementation of innovative solutions, including Australia Post's new regulations prioritizing package delivery over daily letter deliveries, and the development of automated sorting facilities, continues to enhance operational efficiency and service quality in this segment. The parcel freight logistics sector is thus a critical component of the logistics function.

Remaining Segments in Logistics Function

The other significant segments in the Australian Freight and Logistics market include Freight Forwarding, Warehousing and Storage, and Other Services. The freight forwarding market plays a crucial role in international trade facilitation, benefiting from bilateral and multilateral trade agreements. The Warehousing and Storage segment is experiencing transformation through automation and technological integration, exemplified by DHL Supply Chain's significant investment in automation and robotics across Australian warehouses. The Other Services segment encompasses various value-added services, including customs clearance, packaging, and specialized logistics solutions, contributing to the market's comprehensive service offerings and overall efficiency. This logistics industry analysis highlights the diverse logistics function segments contributing to the overall logistics market size.