Growth in the global freight forwarding market slowed to its lowest rate in four years during 2007, according to latest figures published today by industry analyst Transport Intelligence in its 'Global Freight Forwarding 2008' report. However, the research also showed that despite worldwide economic uncertainty, the market still proved resilient, returning low double-digit growth.
The report additionally identified that the sea freight market considerably outperformed its air counterpart. Annual air freight forwarding growth dropped sharply, by almost five percentage points to 7.5% as the market cooled significantly. This was undoubtedly as a result of lower volumes due to the economic slowdown and the migration of some traffic to cheaper sea freight.
Sea freight forwarding, meanwhile, continued to grow at a similar rate to the year before. China's trade continued to develop at a very strong pace and was one of the key drivers of that growth. US exports went some way towards mitigating weakness in that market's imports, and throughout the year, Asia Pacific-Europe trade volumes grew markedly. Market growth was 14.3% in 2007.
Of the main forwarding markets, Europe and Asia Pacific performed best, whilst North America – specifically the US – dragged down overall growth. The 'credit crunch', which has impacted on the US housing market, as well as the downturn in consumer confidence, particularly affected imports into the region, although exports picked up due to the weak dollar. Weakening economic indicators suggest that Europe will be the next market to be affected and this will no doubt be evident in the 2008 growth figures.
Despite the good overall performance of the freight forwarding industry, John Manners-Bell, Ti's CEO, gave a less upbeat assessment of prospects. Commenting on the report's findings, he said: “It is unlikely that in 2008 such high levels of growth will be repeated. There are signs that the European economy has started to weaken in line with the US and this will have a major impact on the strength of the market.”