Food Logistics Market Expected to Reach $260.6 Billion by 2032—Allied Market Research

According to a new report published by Allied Market Research, titled, “Food Logistics Market," The food logistics market size was valued at $116.30 billion in 2022, and is estimated to reach $260.6 billion by 2032, growing at a CAGR of 8.3% from 2023 to 2032.

The food logistics market in Asia-Pacific is expected to grow significantly, owing to high demand for online food and rapid growth of last mile food delivery solutions. Moreover, augmented global trade and strong economic environment predominantly drive the food logistics industry in the European region. The increase in demand for frozen food and the online retail market are expected to hold growth opportunities for the key players during the forecast period. The increase in imports of perishable commodities such as vegetables and fruits in the region is another factor that is contributing toward the demand for food logistics.

Development of the processed food sector in emerging countries in recent times has significantly contributed toward the economic development. For instance, India's food processing sector is one of the largest in the world and its output is expected to reach $535 billion by 2025-26. Food logistics is necessary to handle these products and prevent wastage of food due to unfavorable weather conditions. Therefore, development of the processed food industry is anticipated to propel the growth of the food logistics market.

Moreover, dairy and frozen desserts have witnessed particularly high demand due to economic growth and rapid urbanization internally and externally. Frozen meat, such as burger patties, is also in high demand due to the thriving business process outsourcing (BPO) industry within Asia-Pacific. The BPO industry consists of shift work hours as opposed to fixed timings, leading to an increased demand for convenient, easy-to-consume meals. As a result of these quickly shifting trends, the frozen products segment now accounts for a significant share in the food logistics market.

Food distributors are evolving their processes to ensure efficient delivery to various customer types. Rather than relying solely on static routes, they are adopting a hybrid routing approach. Hybrid routing combines different transportation modes and methods to ensure fast and efficient delivery of food products. This approach may involve a combination of ground transportation (such as trucks or vans), airfreight, and even last-mile delivery options like drones or autonomous vehicles. This allows food distributors to prioritize clients with high volumes and tight delivery windows, ensuring their satisfaction. Meanwhile, deliveries to smaller, more flexible customers be dynamically routed to optimize fleet capacity and balance the workload.

Moreover, delivery software solution providers have launched the software for hybrid routing. For instance, in June 2022, DispatchTrack, a provider of delivery management software, introduced a hybrid routing solution that combines static planning and dynamic routing. This solution is designed to enhance speed and efficiency while ensuring that delivery windows are met. It allows businesses to maintain regular route schedules while optimizing daily delivery capacity. Quirch Foods, a food distribution company, has benefited from this solution by codifying dispatcher knowledge and creating daily skeleton routes, with the ability to dynamically add and adjust stops, as necessary. Hence, this opportunity allows food logistics businesses to offer competitive delivery options, meeting the evolving demands of consumers and businesses for timely and efficient service.

Transport companies operating in the market have incorporated new warehousing services in various countries, which propel the market growth for the storage & warehousing segment. Penetration of fully automated warehousing distribution systems is extremely less, which is expected to provide a remarkable growth opportunity for the key players operating in the food logistics market.

Cereals, bakery and dairy products is expected to grow at a significant CAGR during the forecast period. This segment covers the transportation and logistics of staple grains, bakery goods, and dairy items like milk, cheese, and yogurt. It involves ensuring the freshness and quality of these products during transit and distribution. The increasing consumption of breakfast cereals and baked goods, coupled with the demand for convenience, is boosting the need for efficient logistics in this segment. The convenience of online bakery and dairy product deliveries is driving growth in these categories, with consumers seeking ready-to-eat options.

KEY FINDINGS OF THE STUDY

• By mode of operation, the seaways segment is anticipated to exhibit significant growth in food logistics market in the near future.
• By product type, the fish, shellfish, and meat segment is anticipated to exhibit significant growth in food logistics market in the near future.
• By service type, cold chain segment is anticipated to exhibit significant growth in food logistics market in the near future.
• By business type, value added services segment is anticipated to exhibit significant growth in food logistics market in the near future.
• By region, Asia-Pacific is anticipated to register the highest CAGR during the forecast period.

The key players profiled in the food logistics market report include Agility, AmeriCold Logistics LLC, CJ Logistics, C.H. Robinson Worldwide, Inc, DB Schenker, DHL International GmbH, Hellmann Worldwide Logistics SE & Co. KG, Lineage Logistics, XPO Logistics, and Yusen Logistics.