Airfreight demand surges for the second week in a row and it appears to be uphill from here, IATA predicts a return to pre-Covid demand (far out into the future), and Airbus develops a new cargo system in expectance of long-term disruption.
So here is a short list of what we are seeing so far today:
30% Jump in Market Rates: Week 42 began with import airfreight rate levels at roughly $2.00 more per kg than last week, however those rates are showing not to be stable as space is quickly vanishing. Just 24 hours later, on Tuesday, rates were reaching towards the $9.00/kg mark. As capacity diminishes, the next available flight is also being pushed back further into the future. It is crucial that space is booked as soon as possible for any upcoming shipments.
It is difficult to say what the next few weeks will hold but key indicators, and a bit of instinct, tells us that we will see a busy peak season.
Time to Spare? Not all air services are the same. If you have flexibility, there are alternative options that may do less damage on the wallet. Considering alternative port pairs, to take advantage of available space on other charter services, is just one way to go about this.
We can manage this for you. Just send us your full shipment details, including cargo ready date and absolute delivery deadline, to email@example.com and we will build the best solution.
New Forecasts from IATA: The International Air Transportation Association (IATA) has recently stated that passenger demand will not return to pre-Covid volumes until 2024. This uphill battle will result in a slow incline of widebody space available on the market. This means normalcy to airfreight pricing, especially on US exports, is not expected anytime soon.
But what does this mean for the customer? Procurement standards will change for sure. Those that normally follow an annual bidding process may now find themselves limited to either quarterly bids or even spot pricing. With airlines unsure of what aircrafts will actually be in rotation, near into the future, they will be unwilling to commit to long term, competitive pricing.
Airbus Innovates for Long-Term Disruption: We have all heard about seats being removed from passenger aircrafts to make way for cargo, acting as makeshift freighter aircrafts. This worked well for low value, durable commodities such as PPE but for most commodities air travel requires a lock-and-brace system to secure cargo upright. Consider take-off and landing, when the aircraft is angled, and you can imagine the risk of damage that occurs. Well, Airbus is the first to create a pallet system developed for this purpose and has already been fixed to Asiana Airlines flights from ICN to LAX airport.
Aside from security, what’s the net difference in capacity? Aircrafts fitted with this system can handle almost 5 times the volume, from 5 tons to 23 tons.
For over 70 years, Laufer Group International Ltd. has been helping customers improve the way they handle their logistics. To see how we can help, or for any questions, contact Thomas Marano, National Director of Business Development, Ocean Import or contact your local sales representative.