Air freight rates are skyrocketing after the grounding of many passenger flights in Asia has left shippers scrambling to book limited spots on cargo planes as Chinese industrial production restarts, according to industry insiders.
About half of the air cargo carried worldwide normally flies in the belly of passenger jets rather than in dedicated freighters. But deep flight cuts in response to the coronavirus outbreak have made the market more dependent on freight haulers.
Freight forwarder Agility Logistics said on its website that China's air cargo capacity was down 39% in February relative to last year because of the passenger flight cuts.
Shippers wishing to rush products out of China by air face sticker shock, said Refael Elbaz, chief executive of Israel-based Unicargo, which specialises in freight forwarding for Amazon.com sellers.
"The price is three times higher – at least - because there is just no capacity," Elbaz said.
Freight Investor Services said in an update to clients on Monday that cargo pricing on China-to-U.S. routes had reached "abnormal highs" and that intra-Asia traffic was up by 22% over the previous week. TAC Index data shows China-U.S. cargo rates have tripled over the last two weeks to more than $3.50 a kilogram.
The price surge will benefit freight haulers and help cargo-heavy Asian airlines like Cathay Pacific Airways Ltd , Korean Air Lines Co Ltd and Japan's ANA Holdings Inc offset some of the steep revenue losses from halting many of their passenger flights.
Chris Mu, who runs a small logistics company in Shenzhen, China, that often uses air transport to supply Amazon sellers in Europe and to transport UK-made car parts for assembly in China, said prices had tripled since before the Lunar New Year and are rising by the hour.
"With reduced options, we have to take whatever we can get, flying goods from the UK to the Netherlands, then from Liege in Belgium to Nanchang in Jiangxi province, just to get them to a factory in Shanghai," Mu said. "For the airlines, it's fine because they're still making money, but it's the middlemen like us who are bearing the costs, and we don't like to go to our customers every day and tell them the price has gone up."
DHL's express volumes have started to recover in China and the company is putting planes back into the network, Deutsche Post AG finance chief Melanie Kreis said on Tuesday, noting that its fleet is a major asset given the grounding of many passenger planes.
In mainland China, the number of freighter arrivals has increased in recent weeks as factories resumed production. China's aviation regulator said the number of freighter flights was expected to reach 870 this week, up from 788 in the week starting Feb. 17.
"The number of air charter requests we've gotten in the past week are more than the number we've received in a normal quarter," said Brian Bourke, chief growth officer at SEKO Logistics, a Chicago-based freight forwarder.
Most of those requests involved moving goods from China to the United States, he said.
Reuters
Wed Mar 11 2020
About half of the air cargo carried worldwide normally flies in the belly of passenger jets rather than in dedicated freighters. - FILE PHOTO
Perkembangan proses penamaan calon PRK Kuala Kubu Baharu
Pilihan Raya Kecil (PRK) Dewan Undangan Negeri (DUN) Kuala Kubu Baharu (KKB) membuka tirai hari ini dengan bermulanya proses penamaan calon pagi tadi di Dewan Serbaguna Dan Kompleks Sukan Daerah Hulu Selangor.
Firdaus Azil ada perincian untuk dikongsikan jam ini.
Firdaus Azil ada perincian untuk dikongsikan jam ini.
Malaysia-China bincang perkukuhkan kerjasama sektor pendidikan
Malaysia dan China membincangkan inisiatif strategik bagi memperluas serta memperkukuh jalinan kerjasama sektor pendidikan tinggi antara Kuala Lumpur-Beijing sempena sambutan ulang tahun ke-50 hubungan diplomatik Malaysia-China.
Perdana Menteri ke Riyadh sempena mesyuarat khas Forum Ekonomi Sedunia
Perdana Menteri Datuk Seri Anwar Ibrahim akan mengadakan lawatan kerja ke Riyadh, Arab Saudi sempena mesyuarat khas forum sedunia World Economic Forum (WEF) bermula 27 hingga 29 April ini.
Kerajaan Persekutuan kaji cadangan wujud hospital di Pengerang - Azalina
Hospital tersebut akan memudahkan penduduk mendapatkan rawatan memandangkan Pengerang semakin pesat membangun.
AWANI Ringkas: Reformasi gaji di Malaysia
Ikuti rangkuman berita utama yang menjadi tumpuan sepanjang hari di Astro AWANI menerusi AWANI Ringkas.
Piala Thomas: Lee Zii Jia beri mata pertama buat Malaysia!
Kemenangan straight set benarkan Malaysia raih mata pertama dalam aksi peringkat kumpulan saingan Piala Thomas berdepan Hong Kong.
AWANI Pagi: Filem Oppa semai mesej PDRM banteras jenayah scam
Ikuti diskusi bersama Pengarah Jabatan Siasatan Jenayah Komersial (JSJK) Bukit Aman, Datuk Seri Ramli Mohamed Yoosuf akan berkongsi mesej disemai PDRM dalam membanteras jenayah scam yang berleluasa ketika ini.
Pusat penamaan calon PRK Kuala Kubu Baharu dibuka
Pusat penamaan calon bagi PRK DUN Kuala Kubu Baharu (KKB) di Dewan Serbaguna dan Kompleks Sukan Daerah Hulu Selangor dibuka pada jam 9 pagi ini.
EPL: "Ada sesiapa jangka kami bakal muncul juara?"
Klopp belum sedia nilai musim terakhir bersama Liverpool.
AWANI Pagi: Break the Siege - Pelayaran ditangguhkan, apa seterusnya?
Misi Freedom Flotilla to Gaza, yang sepatutnya memulakan pelayaran minggu lalu, akhirnya ditangguhkan atas pelbagai faktor. Wartawan kami di Istanbul, Syaff Syukri akan kongsi perancangan seterusnya misi ini.
CAAM cadang pindaan Peraturan-Peraturan Penerbangan Awam 2016 untuk rancakkan industri dron
Namun jelasnya penggunaanya juga berupaya mendedahkan risiko-risiko tertentu terhadap pengguna termasuk media seperti isu keselamatan dan pencabulan privasi.
MAB, SHUT berganding banteras aktiviti pemerdagangan manusia
MoU itu antara lain bertujuan untuk memberikan penerangan mengenai isu kritikal yang melanda sektor penerbangan negara.
Pengendali belon udara panas maut jatuh dari ketinggian 30 kaki
Seorang pengendali belon udara panas yang maut kerana jatuh terjatuh dari ketinggian kira-kira 30 kaki pada hari pertama dia bekerja di Youyi Manor, dekat bandar Zhuzhou, China.
Podcast Realiti Rakyat: Westar Aviation utamakan keselamatan pekerja pelantar minyak di luar pesisir
Paparan realiti kehidupan rakyat berdepan dengan norma baharu kehidupan ketika menghadapi pandemik COVID-19.
Malaysia Airlines lancar perkhidmatan sewa khas haji dan umrah
Sebelum ini, Kapten Izham telah menyatakan bahawa Amal akan dilancarkan selewat-lewatnya suku pertama tahun 2019. Amal adalah perkhidmatan yang pertama di dunia yang menawarkan perkhidmatan ini.
I was pressured by Prime Minister's Office - Tony Fernandes
As Tan Sri Rafidah impact and popularity grew, the pressure grew exponentially. It was getting harder and harder to resist the pressure from the Prime Minister's Office.
Ryanair tells pilots it 'grew too fast': Irish Independent
Ryanair shares have fallen over 10 percent since it announced on Friday it would recognize trade unions for the first time.
Boeing umum pemimpin kanan baharu, lancar perniagaan perkhidmatan bersepadu
Boeing berkata Kevin G. McAllister akan menggantikan Naib Pengerusi syarikat itu, Ray Conner.
MH370: Menjelang 400 hari, tiada bendera putih daripada pasukan pencari
Usaha memperluas kawasan pencarian di Lautan Hindi membuktikan Malaysia dan pasukan pencari tidak akan mengangkat bendera putih dalam mendapatkan apa jua petunjuk keberadaan pesawat MH370.
Pengalaman Jagjit mengendali Sidang Media MH370
Menjadi moderator mengendalikan sidang media tragedi MH370 yang dihadiri kira-kira 600 wakil media tempatan dan asing merupakan satu cabaran yang terbesar.