[TheDevs]

Global Chemical Logistics Market Expected to Grow by USD 67.7 Billion by 2028, Driven by Expansion of Chemical Industry and Adoption of Blockchain Technology

The global chemical logistics market is projected to experience substantial growth, with an estimated increase of USD 67.7 billion by 2028, according to a report by Technavio. The market is expected to grow at a compound annual growth rate (CAGR) of over 4.36% during the forecast period from 2024 to 2028. The expansion of the chemical industry and the adoption of blockchain technology in logistics are identified as key drivers for this growth.

The chemical logistics market is highly fragmented, with key players such as Agility Public Warehousing Co. K.S.C.P, BASF SE, and C H Robinson Worldwide Inc. playing pivotal roles in shaping the industry’s future. These companies, along with others like International Business Machines Corp. and A.P. Moller – Maersk, have already implemented blockchain technology to enhance security and efficiency in their supply chain operations.

Blockchain technology offers a secure and transparent solution for maintaining and sharing supply chain data. By utilizing a distributed transaction ledger, it allows multiple stakeholders to maintain identical copies of records on multiple computer systems. Each transaction is cryptographically protected and validated by an independent third party, ensuring security and preventing fraud. The implementation of blockchain technology in chemical logistics provides benefits such as increased transparency, reduced paperwork, and improved traceability and trackability.

The use of blockchain technology in chemical logistics is particularly valuable due to the criticality and confidentiality of the information involved. With an estimated USD 30 billion in annual cargo theft losses in the logistics industry, blockchain technology offers a promising solution for minimizing risk and streamlining operations.

In addition to blockchain technology, the chemical logistics market is witnessing significant trends in various process industries. Three-party logistics (3PL) providers are increasingly managing non-asset chemical logistics, addressing complexities in rail networks and uncertain transit times. Automation in warehouses is driven by challenges such as road quality and pilferage.

Furthermore, the industry is prioritizing green warehouses and sustainable business operations to address environmental concerns. Advancements in technology, such as smart sensors, robotics, artificial intelligence (AI), machine learning, radio-frequency identification (RFID), Bluetooth, drone delivery, and driverless vehicles, are being adopted to improve efficiency and safety in chemical logistics.

The chemical logistics market serves various sectors, including the energy industry, food production, pharmaceutical manufacturing, vehicle manufacturing, and engineering. Collaborations between industry players, such as the American Chemistry Council and the government of India, are crucial for addressing chemical volumes and ensuring safe and efficient transportation.

However, the chemical warehousing and storage market involves significant investment for setting up facilities that adhere to specifications and obtain necessary certifications. Different chemicals require unique storage solutions, and factors such as regulations, political climate, and competition impact market growth. Rising land costs and warehouse rents also pose challenges for operators.

Despite the growth potential, the chemical logistics market faces challenges such as slow adoption of advanced inventory tracking technology, inventory loss through damage, pilferage, and misplacement. These factors contribute to the high cost of investment and operation in the industry, potentially limiting its growth.