While this time of the year is normally considered as the ‘slow season’ for airfreight, we have seen quite the opposite market conditions.
These market conditions are driven by various factors such as low capacity, high ecommerce volumes and on-gong distribution of Covid vaccines and personal protective equipment. While the are no backlogs or major delays reported by any of the airlines, current load factors are high, and capacity is strained on most lanes.
The current market conditions have also driven up the airfreight rates to very high levels, especially on outbound lanes ex China and in particular to the US.
The same goes for charter rates which are at very high levels currently due to the high market demand.
One of very few positive outcomes of the current pandemic is that airlines as well as certain authorities have started to realise the importance of air cargo.
For airlines, this is mainly from a revenue point of view as their cargo divisions have kept them floating when passenger volumes have dropped. The airlines that have suffered the least during the pandemic are those airlines who have large cargo divisions and who have been active and kept on flying by carrying mostly cargo on their passenger aircrafts during the pandemic. Some of the ‘cargo only’ carriers have reported exceptional financial results during 2020 thanks for the extreme demand in combination with high yields.
IATA recently advised that cargo currently accounts for one third of airlines revenue in average which is a big increase compared to pre Covid levels.
The distribution of Covid vaccines have put a welcomed spotlight on airfreight to highlight its importance for global supply chains, this to accommodate the requirements for fast and safe transport solutions.