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COVID-19 Air Freight Update [Updated: 12th May, 2020]

Apr 10, 2020

Air Cargo Capacity Increasing on Many Tradelanes

Global air freight capacity is at 75% of 2019 levels: Seabury reports that last week’s capacity was 25% down on the same period in 2019, when considered on a worldwide scale. Transpacific capacity meanwhile, is now up on 2019 levels by 9 to 18%. On routes from the Asia Pacific region into Europe, capacity is now only marginally below levels in the same week last year. However, transatlantic capacity remains down by more than 50%.

Global wide-body belly capacity has risen by 30% in the last two weeks: However, it is still just 22% of the capacity available in the same period last year. Freighter capacity, however, has risen to 28% above 2019 levels, according to Seabury.

Capacity is increasing week-on-week across many tradelanes: With passenger aircraft in use as freighters, often carrying PPE shipments, overall air freight capacity on transpacific routes is on the rise. Seabury reports the following wide-body belly capacity increases, week-on-week:

  • Asia Pacific to North America – 71%
  • Intra-Europe - 74%
  • Latin America to North America – 68%

Freighter capacity on routes from Latin America to North America has risen by 27%.

Freighter and belly capacity from China is on the rebound: Seabury advises that available space is increasing week-on-week as increased numbers of Boeing 787, 777, and Airbus A330 passenger aircraft are pressed into use for cargo-only operations.

IATA releases guidance for transporting cargo safely in airliner cabins:

  • We have reported regularly on the use of wide-bodied passenger airliners for cargo-only flights using belly space. Some carriers are now expressing a wish to carry additional cargo inside the passenger cabins of their airliners. In response, the International Air Transport Association (IATA) has issued a detailed safety risk assessment and recommendations for the practice. You can see a letter from IATA’s CargoIS team here, which introduces the association’s guidelinesassociation’s guidelines for safe transportation of cargo in passenger-aircraft cabins.
  • Status updates for most of the world’s air cargo carriers are now available on a new web page published by IATA. The Airlines Cargo Operations Status page includes the facility to search by carrier, and classifies operations as follows, depending on the known status:

Normal

Pending airline information

Service suspended

Some service impacts

unknown

  • The page also includes the date and time of the latest update, and links to the carriers’ information pages.
  • Last week, IATA issued its second COVID-19 Air Cargo Impact report. The report focuses on dynamics in the mainland China market, while also providing analyses of other key freight markets, such as the United States, Germany, and Hong Kong.

Origin: Americas

New York City skyline at sunset


Restrictions

  • Canada: The Canadian borders are closing to all but the country’s citizens. International flights will operate to just four airports in Canada.
  • Latin America:

Brazil has closed its borders to nine South American countries.

Peru also closed its borders on March 16 and has declared a state of emergency.

Chile ceased allowing entry to foreigners on March 18

Argentina commenced a two-week border closure on March 15.

Colombia is refusing to accept all incomers for one month. The ban commenced on March 23.

  • USA: While US borders remain open, the UK and Ireland have been the most recent countries added to a broadening swathe of travel restrictions from Europe to the United States. Non-essential travel to and from Mexico is also prohibited by the US government—a measure which came into effect on March 21.

Cargo Impact

  • Europe – North America: Substantial capacity constraints in both directions. Some space available, but with no guaranteed transit times.
  • North America – Asia: Capacity still under constraint. US freighter schedules are slowly returning to normal, but not consistently so. Capacity constraints in Asian transit hubs still exist, impacting destinations that have no direct air-freight flights from North America.
  • North America - India and Middle East: Significant capacity reductions impacting air freight in both directions. Belly capacity fast disappearing, leaving space on freighters only.
  • Europe – Latin America: Substantial capacity constraints in both directions. Some space available, but with no guaranteed transit times.
  • Latin America – Asia: Capacity reduced substantially. Capacity constraints are also affecting Asian transit hubs, impacting air freight from Latin America routed to Asia via the USA.
  • Latin America – USA: Capacity reduced. Belly capacity squeezed due to passenger-flight cancelations, but an increase in freighters is adding to overall capacity.
  • Intra-Latin America: Capacity is fast reducing and becoming constrained to freighters only, mostly routed through Miami, due to passenger-flight cancellations.

Origin: Asia/Australasia

Sydney Harbour Bridge and Sydney city skyline at sunset, with Sydney Opera House visible and the city lights glowing


Restrictions

  • Australasia: New Zealand and Australia have closed their borders to all visitors, with effect from March 20.
  • China: New flight restrictions in China limit foreign carriers to one inbound flight per week. Chinese carriers may fly just one route per week to and from each of the countries they serve.
  • East Asia: As from March 19, all visitors to Hong Kong must self-isolate for 14 days following their arrival. The country is considering stepping restrictions up to impose mandatory quarantine for all visitors. All persons arriving in Taiwan must also self-isolate for 14 days, and the Taiwanese government has banned entry for most foreigners.
  • India: The Indian government has implemented a three-week lockdown, which commenced on March 25. As a result, all no international or domestic passenger flights are in operation. Airport operations and freighter movements are also disrupted due to labor restrictions.
  • Pakistan: All provinces entered government-imposed lockdown on March 24, with suspension of all international passenger flights.
  • Southeast Asia: New restrictions in Cambodia, Malaysia, Singapore, Thailand, and Vietnam have increased the squeeze on intra-Asian air-freight routes, which were already suffering from substantial capacity constraints:

Thailand: Air, sea, and land borders have all been closed since March 25.

Vietnam: On March 21, Vietnam announced that all inbound international flights would be halted.

Malaysia: The closure of air borders and the lockdown currently enforced in Malaysia has been extended until April 14.

Singapore: March 22 saw Singapore announce that all transits through the city-state, and all short-term visits would be prohibited.


Cargo Impact

  • Capacity reduced on all Asia trade lanes: According to Seabury, All routes to and from locations in the Asia-Pacific region are subject to reductions in wide-body capacity.
  • All primary cargo airports seeing capacity reductions: Beijing, Shanghai, and Hong Kong airports show the largest air-freight capacity reductions, but capacity is down at all key airports in Asia.
  • Signs of recovery on inbound and outbound capacity for China: More freighters are operating flights into and out of China, but ocean to air conversion trends are increasing pressure on outbound air-freight capacity.

Passenger-flight cancellations, along with an increase in production in China, is adding to the scarcity of outbound capacity and is impacting mainland China’s export markets.

Customers should consider alternatives to air freight, such as cross-border trucking, where practicable, or multi-leg combinations of ocean and air freight.

Reduced passenger flights from the Middle East, the Americas, and Europe have added to pressure on inbound capacity to China.

  • Intra-Asian air-freight rates see record surges: Due to the huge number of passenger airliner and freighter flight cancellations, capacity has shrunk to unprecedented levels. As a result, intra-Asia air-freight rates have surged upward, continue to increase quickly, and are volatile. This is having a knock-on effect on capacity for long-haul air freight to the United States and Europe.
  • Hong Kong rates increasing: Exports from Hong Kong to the USA and Europe are gradually increasing, while inbound routes from South China are heavily congested. Rates to Europe and the US have increased sharply as a result of new entry restrictions. Charter rates too, have surged.

Origin: Europe

Tower Bridge and London city skyline at sunset, with artificial lighting beginning to stand out against darkening sky


Restrictions

  • The European Union has closed its external borders, encompassing 26 countries and a population of more than 400 million, to most third-country visitors. The closure commenced on March 17 and will be in effect for 30 days at least.
  • Turkey has stopped passenger flights to 14 countries, with the exception of routes to New York, Washington, Addis Ababa, Hong Kong, and Moscow.
  • All Russia’s borders were closed on March 30.

Cargo Impact

  • Cargo-only passenger flights small compensation for overall belly-capacity losses: While several carriers (20+) are operating cargo-only services with passenger airliners, the total belly capacity is still 75% down on January totals
  • Europe – USA: Spot price rates have increased considerably and capacity reductions continue to increase. Some space is available, but with constraints.
  • Europe – China: Capacity is substantially reduced and rates are surging.
  • Europe – Southeast Asia: Substantial capacity constraints exist, arising from passenger-flight reductions. Air-freight rates continue to soar.
  • Europe – Middle East: Rates are high as a result of major capacity reductions.

Origin: Africa and Middle East

Aerial view of the Dubai city skyline at dusk, with the Burj Khalifa illuminated and dominating the scene


Restrictions

  • The Levant and Arabian Gulf:

There are no passenger flights to or from Qatar, although transits through Doha continue.

Kuwait, Jordan, and Saudi Arabia have also halted all inbound and outbound passenger flights.

The UAE has paused passenger flights from March 25, for two weeks.

Freighter flights have not been restricted, and continue to cross the Arabian Gulf.

  • Oman:

All international airports in Oman have been closed to passenger flights from March 29.

Freighter flights are operating as normal.

  • Iraq:

Basra: All airport operations suspended until March 25.

Baghdad: All airport operations suspended until March 25.

Najaf: Airport closed.

Truck movements: Partially halted at specific crossings on the Iraq/Turkey border.

  • North Africa:

Egypt: Outbound flights suspended from all international airports until March 31.

Morocco: Outbound flights are suspended from all international airports, and land borders with Spanish enclaves are closed.

Tunisia: A suspension of all international flights, and closure of land borders commenced on March 16.

Algeria: All sea and air travel to and from Europe has been suspended as of March 19.

  • Southern Africa:

Travel restrictions are broadening across the region.

South Africa has now terminated all commercial flights, inbound and outbound, with air freight operations restricted to the movement of essentials such as medical supplies, food, and cleaning/hygiene products.

Angola implemented a two-week suspension of international flights from March 20.

  • **East Africa: **

Kenya: Inbound and outbound international passenger flights are suspended following an announcement of the stoppages on March 26.

Uganda: Borders closed since March 23, although cargo services are allowed to continue.

Rwanda: Borders closed to all, with the exception of cargo traffic.

  • West Africa:

Ghana and Nigeria both closed their borders with effect from March 23.


Cargo Impact

  • Freight is moving in and out of Africa and the Middle East on scheduled cargo-only flights, as well as via charter and unscheduled freighter services.
  • The region’s major airlines are flying freight in the holds of passenger aircraft, converting them to temporary freighters in the absence of any passengers.
  • All contractual air-freight rates and tariffs are suspended in the region, and committed capacity cannot be guaranteed.
  • Charter rates have doubled, and in some cases, more than doubled.
  • All air-freight rates have reached the highest levels ever and premiums are being levied for moving cargo on a prioritized basis.