Newsletter – October 7, 2021
AIR FREIGHT UPDATES
Air freight load factors soar as peak season demand steps up
Air cargo load factors and air freight rates continued their expected peak season climb in September, according to the latest global market data from industry analysts CLIVE Data Services.
CLIVE’s ‘dynamic loadfactor’ – which measures both the volume and weight perspectives of cargo flown and capacity available to produce a truer indicator of airline cargo capacity utilisation – rose to 68% in the last week of the month, higher than any pre-covid peak season level since CLIVE began sharing data in May 2018. Read more here.
Letter from Bangladesh: direct air shipments to UK remain suspended
The direct shipment of air cargo to the UK from Bangladesh has been suspended for nearly two weeks as the two explosive detection scanners (EDSs) at Dhaka Airport remained out of order.
In the absence of EDS, the airport authority screens cargo with normal scanners, and then explosive-detection dogs (EDDs) examine the freight before it’s loaded onto the aircraft. Read more here.
OCEAN FREIGHT UPDATES
Shipper hopes dashed with prediction of no supply chain recovery before Q4 22
Hopes of a return to some form of normality in global supply chains after Chinese New Year in February have been dashed by analysts.
Both Drewry and MSI now do not expect the supply chain crisis underpinning highly elevated freight rates across several tradelanes to normalise before the end of next year.
“Supply chain turmoil will last longer than thought,” says Drewry in its latest Container Forecaster report. Read more here.
Transpacific ocean rates at a two-month low
With production in China slowed during the Golden Week holiday and by power restrictions in some areas, and with ocean delays making it increasingly unlikely that shipments not already moving will make it in time for the end-of holiday period, transpacific rates stayed level this week after a significant drop a week ago, according to the latest international freight update published by digital rates specialist Freightos, which incorporates the Freightos Baltic Index (FBX). Read more here.
CANADA BUSINESS – GOVERNMENT UPDATES
Canada’s Airlines Seek Passenger Vaccine Mandate Clarification
A new Canadian Government ruling that mandates COVID-19 vaccinations for airline passengers is causing some disquiet among the country’s airline industry. The National Airlines Council of Canada (NAAC) says timelines are tight and queries the lack of consultation. Read more here.
Quebec manufacturers suffering extreme labour shortage
Quebec manufacturers have lost $18 billion in the last two years due to labour shortages which have caused them to turn down contracts, pay late penalties or even scale back their operations.
This conclusion emerges from a survey of 400 manufacturers in 10 regions across the province conducted by Manufacturiers et Exportateurs du Québec (MEQ). Read more here.
INTERNATIONAL BUSINESS – GOVERNMENT UPDATES
‘We’re going to see a lot of bare shelves’: Retail preps for a holiday beset by supply chain pain
Before gifts can make it under holiday trees this year, they are going to have to pass through one of the largest-scale traffic jams modern supply chains have ever experienced.
In the U.S., the industry is not fretting over customer demand headed into the shopping season. Deloitte estimates holiday sales could increase this year by as much as 9%, which would come on top of relatively strong growth last year that surprised pretty much everybody. AlixPartners is even more optimistic, forecasting 10% to 13% sales growth. Read more here.
Industry groups say ending China tariffs would offset supply chain pain
The U.S. trade representative has extended for 45 days tariff exemptions on face masks and related medical care products made in China, but a major trade association says the exemption’s scope should be widened and more Trump-era tariffs should be rolled back to help businesses cope with rising import costs associated with unprecedented port congestion.
So far, the Biden administration has resisted calls from the business community to lift the tariffs on half a trillion dollars of Chinese goods. Read more here.