CSafe boosts cool chain service at Shanghai Pudong Airport

ULD producer CSafe has expanded its cool chain service offering in China by opening a new service centre at Shanghai Pudong International Airport to meet demand growth.

The facility will allow the company to extend support and services to customers transporting pharma products in its containers to and from Shanghai and the surrounding areas of China.

"As the industry's innovation leader in active temperature-controlled air cargo containers, demand for our market-leading CSafe RKN and CSafe RAP containers continues to grow and we are certainly proud to meet that increasing demand with greater support out of Shanghai," said Tom Weir, vice president of global operations at CSafe Global.

"With greater support comes greater impact in protecting life-enhancing products while they are transported to those who need them most."

TIACA foresees slowdown in air cargo market continuing until 2nd half of 2020

THE International Air Cargo Association (TIACA) is warning that the air cargo industry will not experience a peak season on any major trades this year and the weak market conditions will drag on to the second half of 2020.

"We are already at the end of November, and there are some good days, and sometimes even a week that is not too bad, but we will not have a peak period like we saw in the previous two or three years," TIACA chairman Steven Polmans told JOC.com at the group's annual summit. "I haven't met many people that are positive."

The pessimistic outlook comes as trade friction continues to dent business confidence in China, Europe and the United States, and Brexit uncertainty is combining with a weakening European auto industry to slow down demand, reported IHS Media.

"The first six months of 2020 will be difficult before we see an improvement in demand in the second six months," said Mr Polmans. "There is still the question of what happens after Brexit, what will happen with the trade wars, the Middle East, and the oil price."

According to a recently published Freight Investor Service (FIS) report, there is little on the horizon that could boost an already weak year without a sudden surge in volume out of Asia over the next two weeks.

"Fundamental basket routes have run out of steam as we reach the last half of November, with China to Europe going completely flat, and China to US with a marginal gain of (one per cent) over what has been a disappointing, if highly volatile, fourth quarter peak," the FIS report was cited as saying.

Mr Polmans said his lack of optimism going into 2020 was due to the absence of a balanced global environment that would enable international trade to rebound.

"This is the biggest challenge that air cargo is facing," he said. "The most important factor is that we are an industry that needs a certain growth percentage or air cargo cannot blossom. International trade needs a level of calmness to perform."

He continued: "There is a whole level of uncertainty that has been created today - Brexit is on, then it's off, then on again."

He added that the trade wars and retaliatory tariffs are "not helping international trade and a lot of countries are having a nationalistic reflex to the trade situations they are facing, and this is leading them to look for local and bilateral solutions rather than multilateral solutions. It is not an environment where global trade can flourish."

Cathay group cargo volume drops 4.4pc in September to 172,637 tonnes

HONG Kong's Cathay Pacific and Cathay Dragon announced that its September cargo volume declined 4.4 per cent year on year to 172,637 tonnes.

The cargo and mail load factor fell by 3.7 percentage points to 65.5 per cent. Capacity, measured in available freight tonne kilometres (AFTKs), was up by 0.1 per cent while cargo and mail revenue freight tonne kilometres (RFTKs) dropped by 5.3 per cent.

In the first nine months of 2019, the tonnage fell by 6.8 per cent against a 0.7 per cent increase in capacity and a 7.0 per cent decrease in RFTKs, as compared to the same period for 2018.

"As anticipated, our cargo business showed signs of improvement compared to August as we stepped into air freight's traditional high-demand season. Most markets saw a better month-on-month performance and we mounted a number of charter operations on top of our scheduled services to meet added demand for airfreight coinciding with the release of new electronic products. However, the overall market remains challenging and competitive with tonnage carried and load factor for the year to date still significantly below the same period last year," said chief customer and commercial officer Ronald Lam.

There was also and 7.1 per cent year-on-year drop in September passenger volume to 2,426,961. Passenger load factor decreased by 7.2 percentage points to 73.6 per cent, while capacity, measured in available seat kilometres (ASKs), rose by 9.8 per cent.

In the first nine months of 2019, the number of passengers carried grew by 1.3 per cent and capacity increased by 6.9 per cent, as compared to the same period for 2018.

Said Mr Lam: "September was another challenging month for our passenger business, with revenue adversely affected by weakened market sentiment, particularly for travel into Hong Kong.

"Passenger load factor was down 7.2 percentage points and inbound passenger traffic dropped by 38 per cent - both unchanged from August. Outbound traffic was down 9 per cent year-on-year, a slight improvement over the 12 per cent drop seen last month. Transit traffic via Hong Kong remained relatively stable.

"The mainland China market has been hit especially hard and we observed very weak demand for travel over the National Day holiday - traditionally a very strong period."

Mr Lam said the group continued to see a significant shortfall in inbound bookings for the remainder of the year as compared to the same snapshot last year. "This has been felt most strongly with bookings from mainland China and our other Asian markets."

China's Uni-Top Airlines mothballs freighter fleet

SHENZHEN-HEADQUARTERED Uni-Top Airlines has put its fleet into storage in the face of tough market conditions, according to reports circulating in the Chinese press.

A Yicai report suggests that the Wuhan-based carrier is seeking a restructuring and has been struggling to pay staff.

Indeed, fleet data from Cirium shows the airline's eight freighters - one B747-400F and seven A300-600Fs - have all been placed into storage, reports London's Air Cargo News.

The carrier had until very recently been looking to expand its services. At the start of the year it added a B747F flight to Luxembourg three times per week. It also offered a freighter service to Liege, while the A300s were utilised on regional and domestic freighter services.

The carrier had also applied to launch freighter operations to the US.

The Yicai report points to the downturn in the air cargo market as the reason behind the airline's financial difficulties.

Logistical headache in Vietnam with booming air freight exports to US

VIETNAM's booming exports to the US are causing a logistical headache for freighter operators as the trade gap between the two countries continues to widen.

AirBridgeCargo (ABC) saw a 53 per cent increase in Vietnam volumes so far this year, after upping weekly lift from Ho Chi Minh City and Hanoi to two and three flights respectively.

Eric Lamare, the carrier's vice president Asia and Pacific for scheduled cargo operations, told The Loadstar the impressive growth had been largely fuelled by US demand.

"We put into place dedicated operations into the US for specific customers, and this is where the biggest growth is happening," he said on the sidelines of the recent Air Freight Logistics Vietnam conference in Ho Chi Minh City.

"Also, because of the shift in production from China to Vietnam, we see more demand into the US, which is naturally showing faster growth from Vietnam than Europe at the moment."

Mr Lamare said the manufacturing shift from China was not solely down to the trade war, however, and was so far limited in scope. There could be a larger shift in 2020, he believed, given the time it takes to move production, reports London's Loadstar.

Still, Vietnam's exports to the US, its biggest trading partner, surged 33 per cent year on year, to US$36 billion for the first seven months of 2019, according to US Census Bureau data. US exports to Vietnam were valued at $5.9 billion, meaning the trade deficit increased 39 per cent on the same period last year.

"For us, the imbalance is huge," said Mr Lamare. "We already operate two stops on these Vietnam flights; most of the inbound cargo is going to other destinations like Singapore or Taiwan.

"Then we have to position the flights for exports from Vietnam. Only around 30 per cent of the tonnage arriving is for Vietnam, meaning we need to operate smartly with freighters to make these operations profitable."

He said inbound volumes included project cargo, aircraft engines and some pharmaceutical products, while exports remained dominated by garments, footwear and, increasingly, electronics.

Another challenge is Vietnam's creaking infrastructure and its capacity for future growth. National volumes jumped 13 per cent to 1.5 million tonnes last year, with additional growth of at least 10 per cent expected this year. Officials predict annual throughput to reach 2.2 million tonnes by 2020.

"The airports are already quite congested with passenger aircraft, and there's something like 80 freighters a week out of Hanoi and 50 from Ho Chi Minh, which is more congested. Plus there's seven Vietnamese airlines and they don't have freighters yet," explained Mr Lamare.

"So slots will be an issue. We already have restrictions on freighters, so it will be a challenge when we need to increase the frequency of the flights to cope with demand."

There is a new airport planned outside Ho Chi Minh City at Long Thanh, but Mr Lamare said it was "doubtful" the $5.4 billion project would be completed within five years.

As for the remainder of 2019, he said most customers were not expecting a strong peak season from Vietnam.