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air freight

Peak season is upon air freight

Peak season is quickly coming upon the air freight industry. 

Forwarders are reporting limited capacity on Asia-US, with rates from Hong Kong into New York now hitting HK$36 per kg (US$4.58) on major carriers such as Cathay, Cargolux and Asiana. Los Angeles rates are marginally lower, hovering at between HK$30 and HK$35++.

“The air freight market is very busy in China and Asia,” said one Asia-based forwarder. “The rate is increasing every week. But space is still extremely tight, even with high rates.”

He said capacity ex-Hong Kong was particularly in demand, and bulky, loose or dense cargoes were struggling to find space – “It’s very busy.”

Forwarders have a three-day wait to fly cargo out of key hubs in Asia, he added.

Emirates is thought to be full already for the rest of the week, ex-Hong Kong.

Shanghai is also seeing strong demand, and there has been a rise in charter flights to the US, with charter rates increasing apace, and some destinations now not available.

Crucially, November 11, singles day, is coming up and forwarders are predicting higher demand from then through to the end of November.

One EU air freight forwarder said: “The market is going north quickly on air freight inbound flows from Asia. It’s the usual seasonal trend, but the market is tightening up.”

But, he added, he didn’t see the peak being as strong as last year.

“Last year was pretty special. But I reckon there will be some mega peaks and spikes in November,” he said.

“The transpacific market got really busy a week or so back and it is usually two weeks ahead of Europe. European carriers will go for the high dollar rates into the US – and then Europe rates will increase to win back the space. It’s market dynamics.”

Europe too is already seeing movement, but rates are said to be more unsettled, although rising, with some key tradelanes out of Shanghai already busy, with a four-day wait on ad hoc cargo.

Fuel prices are also on the rise, with many carriers raising surcharges, and all carriers out of Hong Kong will raise surcharges from Thursday.

The real question will be if airlines manage to profit significantly – and keep rates high by restricting capacity and selling as much ad hoc space as possible during the peak.

“As airlines went into blocked space agreement discussions this year, their view was that there was too much capacity contracted in 2017, and they didn’t get the results they wanted,” said Neel Jones Shah, head of air freight for Flexport. “So they kept it back this year.”

Another forwarder added: “There are a lot more capacity protection agreements this year that have been signed with the carriers. My gut feeling out of China is that it’s 50%  blocked space agreements and 50% the floating market – we are starting to get two market mechanisms, like you have in shipping.”

The other question is how e-commerce will affect the peak – and for how long.

Speaking at a CIFFA event two weeks ago, Jamie Porteous, chief commercial officer for Canada’s CargoJet, noted: “The peak is explosive, it takes off after Thursday and lasts to the end of January.

“It’s dominated by e-commerce. We have seen a real transition from single digit growth – we’ve now had double digit growth for ten quarters.”

Another UK forwarder added: “The cycle on e-commerce stops much later, people are ordering right up to Christmas. And there is a really early Chinese new year this year, so there will probably be a lot of air freight in January as the Chinese factories won’t have that long.”

Source: The Loadstar

christmas

Christmas bookings for sea freight need to be organised as soon as possible

Are you feeling festive yet?! Maybe not, but sea freight imports need to be organised soon to get them in time for Christmas! Time is of the essence.

Please contact a member of our team as we have very competitive rates for this month – email enquiries@supremefreight.com or call 02380 337778

We handle all types of cargo, including full container load (FCL), less container load (LCL) and NVOCC groupage shipments. We have long standing relationships with a global network of agents at all origin ports which means that we can offer you the best possible service. We have over 30 years experience in the shipping industry, and we can arrange all the necessary documentation to make sure that your goods are transported as seamlessly as possible.

Contact us as soon as possible with your needs so that we can make sure that you don’t miss out. Demand will see a massive increase at this time of year and we can help make sure that stress levels are kept to a minimum!

father christmas

Heathrow at Christmas

Heathrow has released new data revealing the wide array and surprising volumes of seasonal exports that fly in the bellyhold of planes in the months leading up to Christmas.  

Over 143 million kilograms of Christmas cargo is expected to fly via Heathrow to the world in the month leading up to December 25th, a record to date.

New data reveals a sharp spike in exports of seasonal essentials including Christmas lights, calendars, fish, lobster, and meat.

As the biggest port in the UK by value, Heathrow plays a crucial role in delivering the essential ingredients of Christmas celebrations to British homes and homes all over the world.  The airport’s data from November and December 2016 shows a clear spike in the volume of certain Christmas staples coming into the airport and out to non-EU destinations, including:

Christmas lighting sets – 27,467 kg (up from an average of 7,203 kg/month from January – October)

Frozen lobster – 443,146 kg (up from an average of 163,312 kg/month from January – October)

Calendars – 31,316 kg (up from an average of 3,382 kg/month from January – October)

Dried flowers, including for decorations –  310,677 kg (up from an average of 109,796 kg/month from January – October)

Salmon was the most popular export to non-EU destinations overall by weight in November and December 2016, with 6,070,000 kg of fish (equivalent to approximately 480 New London Routemaster Buses) recorded as flying through.    Exports of books were the second most popular commodity – with a recorded 4,834,000 kg going through last year (or approximately 382 New London Routemaster buses).

Heathrow’s data also reveals the top 5 destinations these exports are flying to outside the EU – showing the majority of long-haul exports are destined for American markets:

•United States (15.31 million kilograms)

•China (6.20 million kilograms)

•UAE (3.77 million kilograms)

•Australia (3.36 million kilograms)

•Hong Kong (2.77 million kilograms)

To highlight the wide array of exports flying out of its gates, Heathrow has today launched a “12 Exporters of Christmas” social media campaign.   Each day in the lead up to Christmas, Heathrow will highlight individual stories of SMEs up and down the country that rely on the airport to export British Christmas essentials including tea, jams and biscuits across the world.

In total, Heathrow has seen a record 290,340,803 kilograms of exports flying through from January to October to non-EU destinations this year – an 8.5% increase from the same period last year. These exports are worth an astounding £39.62 billion. Heathrow’s role as a trading hub will grow as expansion takes place, with cargo capacity set to double with the addition of a third runway.

Nick Platts, Head of Cargo at Heathrow Airport said: “Heathrow is at its busiest time at Christmas – and this year, we not only expect record numbers of passengers to fly through, but also a record amount of cargo to be flown in the holds under their feet.   Santa may still have the claim on the most deliveries on Christmas Eve, but for the months before it, Heathrow is doing its bit to export our British Christmas across the world.”

Source:

Heathrow media centre – All figures – unless indicated – exclude EU27 and Switzerland. Sources of figures: UK Tradeinfo, Seabury Group, Heathrow Analysis and Heathrow Monthly Traffic Figures

christmas

‘Tis the season!

Are you feeling festive yet?! Maybe not, but sea freight imports need to be organised soon to get them in time for Christmas! Time is of the essence.

We handle all types of cargo, including full container load (FCL), less container load (LCL) and NVOCC groupage shipments

Contact us as soon as possible with your needs so that we can make sure that you don’t miss out. Demand will see a massive increase at this time of year obviously – and using Father Christmas’s sleigh won’t be an option!