China faces slow airfreight demand as Covid containment continues
27 / 10 / 2022
Photo: Shutterstock
As China enforces continued Covid containment measures air cargo demand is “slow” in the north of the country according to Flexport.
The freight forwarder said that rates were also down in its October 25 freight market update.
Reporting on North China, Flexport said: “Demand is slow, especially for US midwest and USEC destinations. Rate levels have dropped and may continue trending down into November.”
Meanwhile in south China, it said: “The market continues to be soft with rates maintaining at low levels.”
It added that southeast Asia is also experiencing challenges with the overall, export markets remaining “soft”.
Earlier this month, Flexport noted lockdowns being introduced in Ningbo and their potential to hit supply chains, but said export air operations from Shanghai remain unaffected.
In an update dated October 18, Woodland Group said that warehouses in Beilun, Ningbo have suspended operations, while a 48-hour nucleic acid test is still needed for cross-province trucking in Shanghai, although no supply chain impacts in the city were reported.
Zhongyuan district in Zhengzhou was under lockdown with all non-essential businesses closed.
In its latest update, Flexport said demand out of Europe “remains at a low level”, although capacity is expected to drop and rates are also anticipated to rise slightly as winter flight schedules are introduced and passenger flight frequency decreases.
Positive news on the transatlantic trade lanes is that rates are becoming more stable, according to Scan Global Logistics.
As net capacity reduces on the Tran-Atlantic trade due to the introduction of winter passenger schedules, overall capacity is being impacted.
“Subsequently, this is sustaining a more stable rate level development on account of the decreasing capacity, offsetting the fading demand.”
