(Oct 27, 2020) - Peak Season is in full swing heavily impacting the global air cargo market. Market demand is increasing across all regions and impacting the spot market and capacity situation. Predictions this year have been quite different compared to previous years as the market is already in a volatile situation due to limited flights and capacity available as a result of the airline fleet and passenger flight cancellations. This now has led in the last weeks to an even stronger increase in capacity demand as supply remains overall limited. The extension of charter flight operations and high utilization of freighter flights is leading to a situation where additional charter capacity is somewhat limited.
While global trade has recovered across many verticals and even leading to year-on-year increases in some industries, the capacity situation is globally approximately -20% below previous year according to latest data from Seabury Consulting by Accenture. The next couple weeks are expected to reach similar situations as experienced in 2017 and April / May 2020 when overall shortage of aircrafts and crews limited further capacity supply and flights. The impact could even be significantly more severe due to travel restrictions and quarantine measures for crews based on local regulations.
Especially in China we are already observing slightly longer waiting times at the airport terminals due to increased demand and PPE demand returning to the market as the COVID-19 situations across many countries is more critical with increasing cases being observed.
The air cargo market therefore is not only predicted to be challenged by a tough peak-season, but likely to be impacted also in 2021. The industry will be required to support a global distribution of a possible COVID-19 vaccine which is estimated to require some 900 flights of 747-freighter aircraft. This additional demand is already foreseen to require airlines shift flights and capacity from certain trade to the markets with the major demand in a first wave of a vaccine.
Our console charter flight schedule now includes the following flight operations:
➢ Europe – China – Europe: 4 flights per week (B747-400F)
➢ Hongkong – Europe: 2 flights per week (B747-400F)
➢ China – USA: 3 flights per week (B747-400F)
➢ Europe – USA – Europe: 3 flights per week (MD11F and B747-400F)
➢ USA – Australia: 1 flight per week (B777F)
➢ Europe – India – Europe: 1 flight per week (B747-400F)
(Nov 3, 2020) - In response to the tightening of capacity, we have expanded our air charter operations.
Our new “global flight operations programme” connects Beijing, Shanghai, Zhengzhou and Hong Kong to Chicago and Frankfurt ten times a week with exclusive full charter flights. Since air freight capacity remains highly impacted due to international passenger flight cancellations, our new offering creates reliable cargo options exporting from China. In China, the majority of the manufacturers have recovered to normal. No expectation for passenger flights and belly capacity to return to the market within the next 12 months.
Especially high-tech firms are now increasingly utilising airfreight on the transpacific trade lane as they try to meet demand and healthcare demand for medical equipment remains at a very strong level considering the COVID19 situation globally with increases in COVID cases in most major economies and across the continents.
(Oct 27, 2020) - All offices remain in full operation with access to terminal handling and ground transportation. All our European hubs deliver import and receive export freight with no backlogs recorded towards the weekend. Operationally, our linehauls to and from the hubs are running as scheduled. In some areas, our cross-border trucks might experience some minor delays.
(Oct 27, 2020) - There are no significant updates operationally, status remains unchanged.
Logistics and Transport remain classified as essential services and hence are NOT affected particularly. Though resurging COVID-19 infections are evident and tight controls remain in some countries across APAC, our air freight operations remain stable and available to support customer needs. Delays are expected in customs clearance and transportation as lockdowns in some countries affect availability of workforce, including ports, airports, etc. Alternatives to move / transport cargo via other gateways / routes are established. Customers may contact the respective DB Schenker representatives for support or solutions if required.
As APAC countries are opening with the majority allowing manufacturing activities, capacity is expected to remain volatile. We remain vigilant in monitoring the situation, to mitigate events with potential impact to operations.
➢ We also have put additional charter programs (such as for Intra-Asia SG – IN and others) in place. Do get in touch with your DB Schenker Account Managers for further details.
(Oct 27, 2020) - Overall, the air freight operations in the countries remain uninterrupted even as Oman, Kenya, and South Africa slip into partial curfew. We continue to serve our customers. Our regional and global preferred carriers are seen to gradually increase the frequency of passenger cargo flights.
No operational restrictions for air cargo business
Qatar, Kenya, Oman, South Africa, Bahrain, Saudi Arabia, UAE, Egypt
Restrictions for operational air cargo business
➢ Please contact your DB Schenker Account Manager for more information on additional routes.
(Oct 27, 2020) - USA – China
➢ Sufficient capacity for USA exports to key destinations in China. Large number inbound scheduled freighter flights and charters continue supporting USA exports providing capacity to meet market demands on the return leg.
➢ Rate levels are relatively low but remain above pre-COVID-19 levels. Inbound volumes particularly from China remain high. Market demand ex China is strong and expected to be even stronger with more capacity constraints after Golden Week (1 - 9 Oct).
USA – Asia (excluding China)
➢ Destinations with tight capacity continue to be Australia and India from all USA origins. Korea and Singapore with tight capacity and some backlogs from the USA eastern gateway cities of JFK, ATL and MIA. Market pricing moderating from prior highs, but still well above pre-COVID-19 levels.
➢ Flight operations via the DB Schenker Euro Hub in FRA – BOM and Part Charter capacity from ORD – SYD are supporting these high demand destinations.
➢ Outbound USA to OZ in particular is tight.
USA – Europe
➢ Further charter flights have been launched with the Global Flight Operations Program to provide additional air cargo capacity to Europe. These flights are connecting Atlanta and Chicago with Frankfurt, Germany and other surrounding Central European markets. Please contact your DB Schenker sales representative for more details.
➢ Market demand is moderate but growing. Market pricing has stabilized after some downward movement during the summer. As countries continue with ‘reopening’ renewed demand with its upward pricing pressures is anticipated.
USA – Latin Am / Latin Am to Europe and APAC
➢ Intra-Americas: Market demand is moderate with sufficient freighter capacity to most destinations from the USA to Latin Am.
➢ South America exports to other regions: Sufficient capacity but market pricing much higher. Some passenger flights returning, but far from previous frequencies and not providing much additional capacity. The principle carriers for the region have declared chapter 11 bankruptcy (re-organizing). Services continue but with some minor flight scheduling disruptions / delays, which are more pronounced into Peru, Chile and Bolivia as noted.