Market Softens Post-Labor Day: Published airfreight rates from China to the West Coast show a reduction in cost of approximately $3/kg as we head out of last week’s holiday. Meanwhile, East Coast rates remain stagnant still hovering between $11-12/kg. Hong Kong Rates have dropped by about 10-20% settling at $9-$10/kg regardless of U.S. destination region.
Challenges This Week for Taipei: China Airlines (CI) and Eva Airways (BR) have both significantly reduced cargo capacity in response to a Covid-19 outbreak impacting pilots and crew members. In compliance with the Taiwanese Center of Disease Control, many flights to the USA have been canceled. It is expected that CI will reduce their flights by half starting May 12th. Reports are indicating that all flights between JFK, ORD, and DFW will be grounded for a period of 2-3 weeks.
Naturally, space and rates will be impacted. Published rates from TPE to the USA were between $14-$16/kg but are forecasted to escalate due to new conditions.
April Outpaces Pre-Covid Volume: When compared to 2019 (skipping last year for obvious reasons), tonnage for the month of April has grown by 1%. A nominal amount for sure but a great sign for the health of the economy. As a reminder, capacity for air cargo is still around 50% lower than it was during the previous period. The space and price woes will continue for now.
India Ban on Commercial Flights: Government officials in India have decided to extend the ban on all international flights until the end of May. This restriction applies to passenger aircrafts only; cargo and charter flights are still able to operate in and out of the country. Prices are affected heavily.
There are options – from premium carriers, alternative routes, and priority/guaranteed services. Let us know the challenge you are facing, and we can find the right solution for you. Reach out to tmarano@laufer.com