Air Partner expects charter market surge
16 / 03 / 2020
By Damian Brett
Charter broker Air Partner has urged companies to book cargo transport early to keep supply chains moving in light of the coronavirus.
The company said that it has reported a spike in demand while capacity is in short supply as passenger airlines have axed services.
Air Partner chief executive Mark Briffa said: “We’re seeing a spike in airfreight service requests as many commercial flights are being grounded and at a time when Chinese industrial production is restarting after a month-long shutdown. There is still immediate charter availability, but we foresee that could change in the coming weeks.”
The broker said that is has access to any freight aircraft between North America and Europe or between North America and China, or South East Asia, “at a moment’s notice”.
“If availability does decrease, prices will surge,” it warned. “As such, to reduce risk and guarantee availability, Air Partner recommends companies secure aircraft charter solutions as soon as they are needed.”
It warned that freight rates from China have already begun to increase as demand increases.
Figures from the latest TAC Index show airfreight prices from Shanghai to North America increased by 32.3% from a week earlier to $4.02 per kg, while prices from the Chinese city to Europe jumped by 15.8% compared with the prior seven days to $2.71 per kg.
Meanwhile, prices from Hong Kong to North America increased by 11.5% week on week to $3.59 per kg and there was a 3.2% increase to $2.58 per kg on services to Europe.
On the capacity side, Air Partner warned that the US travel ban for Europeans would cause an immediate negative impact on availability and significant increase in pricing for cargo capacity to Europe for at least 30 days.
For China, it said available cargo capacity from China is down 39% versus last year and flight cancellations on routes to China have removed close to 5,000 tons per day of capacity, with belly capacity down by 85% and maindeck capacity down by 12%.
It added that more than 40 airlines have temporarily suspended operations to and from China to-date and this is likely to continue to rise with no estimated date to recommence commercial airline operations.
“With China beginning to slowly ramp up production again, it will take some time for scheduled freight operators to readjust their capacities to normal schedule,” the broker said.
“During the coronavirus outbreak, Air Partner has seen a large increase in urgent freight requests from companies seeking to transport a number of different commodities between North America, Asia and Europe.”