UAE Logistics and Warehousing Market Outlook to 2029

The report titled “UAE Logistics and Warehousing Market Outlook to 2029 – By Market Structure, By Service Segments, By End Users, By Mode of Transport, By Type of Warehousing, and By Emirates” provides a comprehensive analysis of the logistics and warehousing sector in the UAE. The report covers an overview and genesis of the industry, overall market size in terms of revenue, market segmentation, trends and developments, regulatory landscape, customer-level profiling, issues and challenges, comparative landscape including competition scenario, cross comparison, opportunities and bottlenecks, and company profiling of major players in the UAE Logistics and Warehousing Market. The report concludes with future market projections based on service demand, transport mode, end-user verticals, region-wise outlook, cause-and-effect relationships, and case studies highlighting growth opportunities and strategic considerations.

UAE Logistics and Warehousing Market Overview and Size

The UAE logistics and warehousing market reached an estimated valuation of AED 85 Billion in 2023, driven by the country’s role as a regional trade and transport hub, rising e-commerce penetration, and continuous infrastructure investment. The market is dominated by players such as DP World, Emirates Logistics, Aramex, Agility Logistics, and Hellmann Worldwide Logistics, offering integrated solutions across freight forwarding, last-mile delivery, cold storage, and bonded warehousing.

Dubai remains the epicenter of logistics due to its well-established ports (Jebel Ali), airports, and free zones like Dubai South and JAFZA. Abu Dhabi and Sharjah are also emerging as key logistics corridors due to industrial diversification and government-led logistics cluster development.

In 2023, Emirates Post Group and Aramex launched joint last-mile delivery optimization programs, targeting reduced delivery time by 30% to meet the e-commerce sector’s growing needs.

What Factors are Leading to the Growth of UAE Logistics and Warehousing Market

• Strategic Geographic Location: UAE’s location between Europe, Asia, and Africa positions it as a vital transshipment hub. Over 50% of global trade routes pass within 8 hours’ flight of the UAE, increasing its importance in global supply chains.

• E-commerce Boom: The UAE e-commerce market surpassed AED 27 Billion in 2023, increasing the demand for last-mile delivery services and fulfillment centers. Fulfillment solutions now represent over 15% of total warehousing demand.

• Free Trade Zones and Infrastructure: Government investments in free zones, rail logistics (Etihad Rail), and smart ports have significantly boosted logistics capability. In 2023, over 90% of logistics operations in Dubai were handled through free zones offering tax-free incentives.

Which Industry Challenges Have Impacted the Growth for UAE Logistics and Warehousing Market

• High Operational Costs: The UAE logistics market faces significant operational cost burdens, particularly around warehousing rentals, fuel prices, and labor. In 2023, operating costs accounted for nearly 45% of total logistics expenditure, making profitability a challenge for smaller logistics players. Dubai’s Grade-A warehouse rents surged by 12% year-over-year, tightening margins further for SMEs and startups.

• Fragmented Last-Mile Delivery Ecosystem: While last-mile delivery has grown with e-commerce, it remains fragmented and cost-inefficient. An industry report in 2023 revealed that delivery failure rates touched 18% due to inaccurate address data and poor logistics coordination, particularly in dense urban zones like Sharjah and Abu Dhabi suburbs.

• Talent and Skill Shortages: Despite automation growth, there is a 25% shortfall in skilled logistics personnel, including warehouse managers, inventory planners, and customs clearance experts. This talent gap has slowed the adoption of advanced supply chain technologies and hampered service quality.

What are the Regulations and Initiatives which have Governed the Market

• Customs and Free Zone Regulations: The UAE has implemented simplified customs clearance mechanisms within JAFZA, KIZAD, and Dubai South, allowing 24- to 48-hour processing for bonded goods and transit cargo. These zones offer 100% foreign ownership, tax exemptions, and 0% import/export duties, helping attract global logistics firms.

• National Freight and Logistics Strategy 2030: Spearheaded by the UAE Ministry of Energy and Infrastructure, this strategy aims to position UAE among top 10 global logistics hubs by 2030. It includes investment in rail (Etihad Rail Phase 2), green logistics zones, and digital platforms. By end-2023, over AED 2 billion had been committed to logistics infrastructure expansion.

• Sustainability Regulations: In line with the UAE Net Zero 2050 Vision, logistics companies are now mandated to adopt sustainable practices such as fleet electrification, green warehousing, and carbon reporting. As of 2023, over 30% of major warehousing facilities in Dubai and Abu Dhabi had installed solar rooftops and energy-efficient HVAC systems.

UAE Logistics and Warehousing Market Segmentation

• By Market Structure: The organized segment dominates the UAE logistics and warehousing market due to the presence of large, globally integrated logistics firms, well-managed industrial parks, and adherence to international service standards. Companies operating in this space—such as DP World, DHL, and Agility—offer value-added services like inventory optimization, bonded warehousing, and smart fleet tracking. The unorganized segment, though smaller, still plays a role in last-mile logistics, informal courier services, and smaller-scale storage in non-regulated industrial zones. However, increasing regulatory compliance and customer expectations are pushing this segment toward formalization.

• By Service Segment: Freight forwarding and contract logistics form the backbone of the UAE logistics ecosystem. Freight forwarding dominates due to UAE’s positioning as a transshipment hub for air and sea cargo. Contract logistics, including warehousing and value-added services like packaging, labeling, and last-mile delivery, is rapidly growing with the rise of e-commerce and retail demand. Cold chain logistics is also emerging, driven by pharmaceuticals, F&B, and fresh produce imports.

• By Mode of Transport: Road transport remains the dominant mode for domestic cargo movement, especially within the Emirates. Sea freight leads in international logistics due to ports like Jebel Ali, Khalifa Port, and Port Rashid. Air freight plays a critical role in high-value and time-sensitive cargo, supported by Dubai International Airport and Abu Dhabi International Airport.

Competitive Landscape in UAE Logistics and Warehousing Market

The UAE logistics and warehousing market is moderately consolidated, with a mix of global logistics giants and regional players dominating key service segments. Dubai and Abu Dhabi serve as operational hubs for many of these companies, leveraging advanced infrastructure, free zone advantages, and digital innovations. Notable players include DP World, Aramex, Emirates Logistics, Agility Logistics, Hellmann Worldwide Logistics, Trukker, RSA Global, and Mohebi Logistics, who offer integrated logistics and warehousing services across multiple sectors.

Some of the recent competitor trends and key information about competitors include:

• DP World: A leading enabler of global trade, DP World expanded its logistics footprint in 2023 with the launch of CARGOES Logistics, a digital platform offering end-to-end supply chain services. The company handled over 20 million TEUs at Jebel Ali Port in 2023 and continues investing in smart port and automation technologies.

• Aramex: Aramex saw 17% YoY growth in e-commerce deliveries in 2023, supported by last-mile optimization and partnerships with regional retailers. It is investing in AI-driven route planning and expanding fulfillment centers in Dubai and Riyadh.

• Agility Logistics: Agility enhanced its contract logistics and cold chain warehousing capacity by over 30% in 2023. The company is targeting high-growth sectors such as healthcare, food, and retail, and has opened a new 26,000 sqm facility in Dubai South.

• Emirates Logistics: Focused on integrated logistics, the company introduced real-time freight visibility tools in 2023, aimed at improving customer transparency across the GCC trade corridor.

• Trukker: As a regional digital freight network, Trukker expanded operations to Saudi Arabia and Egypt and added cross-border trucking services. The platform processed over 1.2 million shipments in 2023, focusing on tech-led scalability.

• RSA Global: Known for supply chain digitization, RSA Global reported 40% growth in demand for bonded warehousing and value-added logistics services in 2023, especially from pharma and FMCG sectors.

• Mohebi Logistics: With over 90 years in operation, Mohebi is a major player in FMCG and cold chain logistics. In 2023, the company added 20,000 pallet positions in its Abu Dhabi warehouse and partnered with global food distributors for regional consolidation.

What Lies Ahead for UAE Logistics and Warehousing Market?

The UAE logistics and warehousing market is projected to continue its upward trajectory through 2029, supported by the country’s strategic location, trade facilitation policies, and rapid growth in e-commerce and digital retail. The market is expected to grow at a CAGR of 6.8% from 2024 to 2029, with significant investments in smart logistics infrastructure, automation, and sustainability initiatives driving the next wave of transformation.

• Rise of Multimodal Logistics Integration: With the rollout of the Etihad Rail network, logistics operators are expected to increasingly adopt multimodal strategies combining rail, road, air, and sea. This integration will reduce transit time and costs, particularly for inland and cross-border freight, and support the UAE’s ambition to become a fully integrated logistics hub.

• Growth of Smart Warehousing and Automation: The warehousing segment will witness a surge in automated storage systems, AI-based inventory management, and IoT-enabled smart facilities. In free zones like Dubai South and KIZAD, operators are deploying robotic picking systems and warehouse drones to enhance efficiency and reduce manpower dependency.

• Expansion of Cold Chain and Pharma Logistics: Driven by regional demand for temperature-sensitive goods and pharmaceuticals, cold chain logistics is expected to grow at over 9% CAGR. UAE’s role as a vaccine and life sciences distribution hub will further fuel investment in GDP-compliant cold storage facilities and specialized fleet infrastructure.

• Digital Freight Platforms and AI Optimization: Platforms offering real-time freight matching, predictive analytics for route optimization, and digital freight payments are gaining traction. By 2029, more than 50% of UAE freight forwarding transactions are expected to be facilitated through digital platforms, improving transparency and reducing brokerage inefficiencies.

• Sustainability-Driven Infrastructure: With the UAE’s commitment to Net Zero by 2050, logistics providers are investing in green buildings, EV fleets, and carbon offsetting solutions. Companies are expected to adopt LEED-certified warehousing, solar-powered logistics parks, and eco-efficient packaging as part of ESG mandates from global clients.

UAE Logistics and Warehousing Market Segmentation

• By Market Structure:

  • Organized Logistics Players

  • Unorganized Local Operators

  • 3PL and 4PL Service Providers

  • Government-Linked Logistics Companies

  • Courier & Express Delivery Services

  • Freight Forwarders

  • Contract Logistics Providers

• By Service Segment:

  • Freight Forwarding (Air, Sea, Road)

  • Contract Logistics

  • Last-Mile Delivery

  • Cold Chain Logistics

  • Express Delivery

  • Value-Added Warehousing Services

• By Mode of Transport:

  • Road Freight

  • Sea Freight

  • Air Freight

  • Rail Freight (Etihad Rail integration)

• By Type of Warehousing:

  • Ambient Storage

  • Cold Storage

  • Bonded Warehouses

  • Fulfillment Centers

  • Automated Warehousing

  • Dedicated vs. Shared Warehousing

• By End User Industry:

  • E-commerce

  • Retail & FMCG

  • Automotive

  • Healthcare & Pharmaceuticals

  • Oil & Gas

  • Industrial Manufacturing

  • Food & Beverage

• By Emirate:

  • Dubai

  • Abu Dhabi

  • Sharjah

  • Ras Al Khaimah

  • Ajman

  • Fujairah

  • Umm Al Quwain

Players Mentioned in the Report:

• DP World

• Aramex

• Agility Logistics

• Emirates Logistics

• Hellmann Worldwide Logistics

• Trukker

• RSA Global

• Mohebi Logistics

Key Target Audience:

• Logistics and Freight Companies

• E-commerce and Retail Companies

• Industrial Warehousing Operators

• Regulatory Authorities (e.g., Ministry of Energy and Infrastructure, Dubai Customs)

• Industrial Zone Authorities (e.g., JAFZA, KIZAD)

• Cold Chain Solution Providers

• Infrastructure and Real Estate Developers

• Investors and PE Firms in Supply Chain

Time Period:

• Historical Period: 2018–2023

• Base Year: 2024

• Forecast Period: 2024–2029