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Air cargo market 'going crazy' as carriers prepare for a tight peak season

Forwarders are securing air cargo capacity for the fourth quarter, anticipating a tight peak season as rates start to rise again.

“This week could be the calm before the storm,” said David Wystrach, senior director of air freight EMEA for Flexport.

“The past weeks can be considered as typical for the summer months. We saw lower volumes, aircrafts in maintenance, and uncertainty about the weeks to come.

“Now, in mid-September, with Golden Week approaching in Asia, we may be at the doorstep of a quarter-four rush.”

Another European forwarder said there was “definitely a massive upswing in air freight demand, with retailers and businesses moving air freight – and that’s without the hi-tech launches filtering through.

“The market is going crazy – there is a definite peak and rates are heading north quickly.”

Mr Wystrach added: “Indicators suggest we are heading for a peak season, in which the impact of summer and winter schedule changes will not be the same as in the years before. We will likely see changes to cargo capacity, as airlines are deciding faster on flights and the number of rotations to be added or reduced.

“However, with revenues from passengers down, no matter which tradelane we look at, we may see a scenario in which a peak is further driven by reduced capacities, rather than significantly growing volumes (with the exception of major product-launches and the impact any vaccine-supply will have on capacity).”

DHL Global Forwarding said this morning it had launched an air freight service connecting Asia Pacific to Europe, “to meet demand from customers in the technology, manufacturing and life sciences and healthcare sectors”.

The charter service will be twice weekly from Chongqing to Amsterdam, Chicago and Incheon.

“While some passenger airlines have resumed operations, the situation in the air freight market remains volatile – especially as belly capacity is still tight,” said Thomas Mack, global head of air freight.

He added: “DHL Global Forwarding’s top priority is to provide our customers with sufficient and reliable air freight capacity. Not only are the resilient, agile and reliable supply chains of highest importance for an economic recovery, but also in preparation for the availability of vaccines and other essential medical supplies during the pandemic.”

The service will be run by the forwarder’s in-house charter team, StarBroker.

DB Schenker has also boosted its air charter operations, connecting Atlanta and Chicago with Frankfurt. The flights will operate three times a week, some on partial charter flights, to provide “much-needed” capacity, it said.

And it is not just the air freight market heading into crazy territory: ocean freight is currently seeing ‘a perfect storm’ of high demand, container shortages, record high rates and service disruption.

Source: The by Alex Lennane14/09/2020

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