Airfreight rates remain high and steady regardless if volumes are up or down, disruption hits Los Angeles and Chicago, and Vietnam imposes strict shutdowns on inbound flights.
Here is a short list of what we are seeing so far this week:
Air Rates Remains Strong: Demand and capacity issues remain steady resulting in TPEB market rates similar to last week levels. However, spot rates due to lack of space, are stretching beyond $10/kg levels. Available charters are slim pickings and there are almost no available aircraft for contract hire until January.
Airport Disruption at ORD and LAX: Delta Cargo shut down their O’Hare cargo terminal through December 2nd for a total of nine days. The reason reported – staffing issues. During this time Delta was not accepting, transferring, or delivering any shipments. Meanwhile, manpower issues at LAX airport have created a breakdown delay and many Asia inbound flights have been canceled. Air China has reduced cargo flights from PVG to only three per week and canceled all “preighters” from China. China Southern has canceled 10 flights thus far and more are expected. These restrictions are expected to apply until the new year.
November Airfreight Demand Subsides: Looking at the rates for the past two weeks it would be hard to tell that airfreight demand has actually weakened, but this is indeed the case. For the first time in six months, during what was expected to be a peak season boost, demand has actually dropped by a percentage point. YoY volumes are still down by -13% however. Considering the almost 40% decline seen back in April, the gap is closing.
Vietnam Shuts Down Inbound Fights: After lifting suspensions on international passenger flights from seven Asian countries in September, the Prime Minister has placed an embargo on all inbound commercial flights once again. This is a reinstatement that comes nearly six months after its first effective date of March 25th. The decision comes as a result of the first community based Covid outbreak in almost 90 days. The alleged transmitter of the virus was a flight attendant that returned from Japan mid-November. The country is not expected to reinstate flights until proper quarantine measures are put into place.
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, Airfreight & e-Commerce or contact your local sales representative.