Newsletter – September 1, 2021
AIR FREIGHT UPDATES
European regulator extends temporary-freighter exception into 2022
The European Union Aviation Safety Agency (EASA) has extended rules allowing airlines use passenger aircraft as temporary freighters into next year.
The extension means that airlines will be able to carry certain cargo in passenger holds until July 31.
Airlines have been removing passenger seats from aircraft since the start of the outbreak in response to lost cargo capacity and to keep aircraft employed. Read more here.
IATA: July a solid month for air cargo but risks remain
July was another solid month for the air cargo industry, but rising Covid numbers could disrupt the sector’s recovery, according to IATA.
The latest numbers from the airline association show that in July demand in cargo tonne km (CTK) terms increased by 8.6% compared with the same month in 2019 (used to mitigate 2020 Covid distortions). Read more here.
Amazon Air bumps cargo handler from Newark airport
Alliance Ground International, a Miami-based cargo handling services provider, said Tuesday it has opened a new import handling facility five minutes from Newark Liberty International Airport after getting displaced from its existing airport warehouse by Amazon Air.
Two other ground agents, along with 22 airline customers, are also losing a home this fall, leaving logistics companies in the region wondering if their shipments will be negatively impacted. Read more here.
‘Big chaos’ coming as lack of air freight capacity will see peak season rates soar
Forwarders are predicting ‘big chaos’ and very high rates in the coming air peak season, as a host of issues combine, leading to demand significantly outstripping supply out of Asia.
The problems in Shanghai, where an outbreak of Covid has led to strict crew and quarantine rules for all airlines, and reduced manpower on the ground by about two-thirds, are expected to exacerbate the already bad situation. Read more here (login required).
OCEAN FREIGHT UPDATES
California port pileup shatters record and imports still haven’t peaked
From anchorage stats to forward arrivals, ocean bookings, and inventory-to-sales numbers, all the latest data paints the same picture: The U.S. congestion crisis has never been more severe than it is now — and it’s getting worse.
Hope for any relief this year has vanished. French carrier CMA CGM is the latest in a long line of market participants to push back its timeline on normalization. Capacity constraints “are expected to continue until the first half of 2022,” CMA CGM warned on Friday. Read more here.
HMM seafarers step up pay protest, and now office staff also vote to strike
At 8pm Seoul time, seafarers working for HMM began a picket protest from two of the Korean flagship carrier’s ships in Busan port, even as their union leaders continued negotiations with management.
On 22 August, some 450 of HMM’s 600 seafarers voted on industrial action, and more than 92% of them opted for a strike.
And yesterday, HMM’s management received another manpower blow when 98% of its 755 unionised office staff voted to strike. Read more here.
Box shipping not for everyone
If container shipping was easy, everyone would be doing it, particularly with the current profits to be made.
The fact that rivals to the main container lines seldom emerge suggests that it is not easy, but a few beneficial cargo owners are now giving it a go.
Recent announcements by US retailers Walmart and Home Depot that they have begun to charter their own tonnage to ensure delivery of stock to their stores, and by several freight forwarders securing capacity for their customers, indicates there is a gap in the market for DIY container shipping. Read more here.
GROUND AND RAIL FREIGHT UPDATES
STB rejects CN plan for KCS acquisition
Canadian National Railway Co.’s takeover bid for Kansas City Southern Railway has been thrown into doubt after a U.S. regulator denied its use of a voting trust structure.
STB says trust would reduces incentives for competition where KCS and CN routes overlap.
The U.S. Surface Transportation Board said Tuesday that the trust would reduce incentives for competition between the two railways whose networks overlap, and is not consistent with the public interest standard under its merger regulations. Read more here.
CANADA BUSINESS – GOVERNMENT UPDATES
Businesses to raise prices as party leaders contend with rising cost of living
More than a fifth of Canadian businesses expect to raise prices over the next three months, according to a Statistics Canada survey, at a time when the cost of living has become a hot-button issue on the campaign trail.
The Canadian Survey on Business Conditions, a quarterly report released on Aug. 27, reported that the number of businesses that plan to implement price increases grew from the second quarter this year, up to 21.7 per cent from 19.9 per cent. Read more here.