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Freighter flights resuming at Shanghai, but reduced capacity pushes rates higher

Freighter flights are slowly resuming at Shanghai Pudong Airport (PVG), but a reduced workforce means week-long cargo delays and fast-moving freight rates.

Last Friday, China’s drastic Covid policies caused widespread cargo disruption at PVG, after a positive Covid test at ramp handler Shanghai International Airport Services, resulting in hundreds of staff sent for testing or quarantine and mass flight cancellations.

According to Flexport, which has been re-routing charters to Hong Kong, space is still scarce. Cargo capacity from PVG is down by a third and ramp handling capacity down 80%.

The forwarder added: “Only smaller shipments get prioritised by airlines. The transit time ex-PVG will be extended by five-to-seven days for transpacific eastbound lanes. EU destinations are currently delayed two-to-three days.”

Cathay Pacific said it had resumed “most” of its freighter services to and from PVG, after having suspending flights until 23 August.

One Chinese forwarder in Shanghai said cargo terminals PACTL and EAL were operating, albeit with a reduced workforce. Therefore, he added, the airport’s reduced manpower – already stretched to the limit by extreme quarantine rules – had resulted in cancelled ‘preighter’ flights and a 50% loss of capacity.

He said: “Only small percentage of freighters have been cancelled, but perhaps not because of Friday’s Covid disruption, but affected by the airline crew quarantine requirement already in place – for example, some airlines, like China Southern, need to bring crew from Guangzhou to fly its freighters out of PVG.

“We expect most freighters will be back to schedule soon, while all passenger-freighters will remain cancelled until 5 September.”

He added that a lot of cargo was being diverted to Beijing, meaning the backlog at PVG was not as serious as before.

“The present booking window with airlines is about one week in advance,” he said.

Furthermore, with capacity from PVG down 30%-50%, rates are continuing the upward spiral experienced since the start of the year.

“Rates have increased a lot since Friday,” the forwarder explained. “One scheduled charterer increased rates to the US by $1.50-$2 per kg within the past two days.”

Other forwarders have estimated that rates from PVG could reach $12 to $15 per kg by next week.

Credit: The Loadstar by Sam Whelan

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