Bangladesh air cargo market faces logjams following protests

The Bangladesh air cargo market faces delays and sky-high rates after weeks of protests against the government and deadly clashes between police and demonstrators.

Reports suggest the situation in the country today appears to be easing after prime minister Sheikh Hasina yesterday resigned and fled the country.

However, the air cargo market faces a difficult situation according to one freight forwarder contact.

He described the outlook at Dhaka airport as “challenging”, with a high volume of cargo waiting for flights amidst limited options and capacity.

Cargo movement out of the country was stopped for several days as the government shut down the internet and installed road blockades in response to the protests.

Cargo operations resumed on July 25 but exporters now face backlogs and higher rates.

“Rates to European and US corridors are significantly higher than usual,” the contact told Air Cargo News. “As an alternative to direct air, forwarders [have] initiated air-air products via Colombo, Singapore, Malé and Dubai. Road-air via Delhi and sea-air via Colombo and Dubai.

“Average air-air time and road-air ex Dhaka to Europe and the US is around 10 days while sea-air via [Dubai] requires 22 days and via Colombo [is a] 14 days service.

“However, the extended transit times and limited flight options are exacerbating the situation, leading to increased rates and delays.

“The current circumstances, including slow port activity in Chittagong, are creating a bottleneck in the supply chain, further driving up demand for airfreight.

“The unprecedented high rates and prolonged disruptions in Bangladesh are posing significant challenges for the industry, surpassing even the difficulties faced during the Covid-19 pandemic.”

He said that rates to Europe are now around $6 per kg, while to the US they have reached $8.50 per kg, which is around three times the usual price.

Hundreds of people have been killed in protests initially led by students in response to a quota system for government jobs, where a certain percentage of jobs were reserved for veterans of the 1971 war of independence and their families.

However, the protests became a broader anti-government movement as a series of crackdowns were implemented and weapons were reportedly used against the students.

An interim government is in the process of being put in place but much uncertainty remains.