Cargo capacity stays tight as some passenger flights are back on the runway
Passenger aircraft are coming back into the market – in some regions – but capacity in Europe remains tight.
However, widebody passenger capacity between Asia and Europe rose 16% in weeks 44 and 45, according to Accenture Seabury data, released this morning. Freighter operators, meanwhile, withdrew capacity from Latin America, adding instead 5% between Europe and Asia.
Asia-Pacific to the Middle East also saw a double-digit rise in passenger capacity, up 15%, and between Asia Pacific and North America, passenger capacity also rose, but at a more muted rate, up 6%, and up 8% on the reverse lane. The biggest loss of capacity was in Latin America, where passenger capacity to and from north America fell 21% and 22% respectively, while freighter traffic fell 7%.
Some 12% of passenger capacity between Europe and Latin America was withdrawn, alongside a whopping 30% decrease in freighters. But on the reverse route, there was a 3% rise in freighter capacity.
Chargeable weight from Latin America dropped some 20% in week 44, according to Clive Data Services, while load factors were 74% – but they fell to just 66% in week 46, suggesting fewer exports by air, which could explain the withdrawal of capacity.
The consultant also examined stored aircraft, of which 58% are narrow-bodies, while there are very few freighters remaining in storage.
The capacity data was revealed as the TAC Index shows rates largely flat during the period reported by Seabury. But now, rates on some lanes are beginning to rise again, with China-Europe edging up, and EU-US jumping significantly. There were declines on US-EU, however, as well as on China-US.
Air cargo bounce back slackens in early November.
Air cargo's steady recovery in recent months showed signs of slackening in the first half of November, a tell-tale sign being that yields/rates from China dropped for the first time in many weeks, the latest data from WorldACD shows.
Worldwide, the kilograms transported in the period 1-15 November (H-1 Nov) stood at 48% of the total for the whole of October (from Asia Pacific 51%, Europe and North America 47%, Central and South America 46%, Middle East & South Asia (MESA) 44%, and Africa 42%), it noted.
On the China-Asia Pacific trade lane rates decreased by 9.5% (to US$ 2.20/kilo), fell by 0.9% from China to Europe (to US$ 5.08/kilo) and shed 6% on China-North America routes (to US$ 5.93/kilo).
The average load factors were slightly lower in H-1 Nov than in October. We did not see a WoW change in last week’s (second week of November) data, except for the load factors ex-Europe which went up by more than 1.5 percentage points. As for the key takeaways from the market last month, volumes were “only” 11% below October 2019, but 8% above September 2020.
New York — Containership owners have nominated further surcharges and rate increases for Asia-to-Europe routes in the final weeks of the year as a shortage of boxes in Asia outpaces the slowdown in export shipments.
France's CMA CGM announced on Nov. 10 a $600/FEU "peak season surcharge" to take effect from Nov. 15 for shipments from all Asian ports to all destinations in the Mediterranean Sea. German shipowner Hapag-Lloyd was even more expansive in its general rate increase announcement for Dec. 1, nominating rate hikes for sailings from East Asia (excluding Japan) of $5,190/FEU to the UK, $4,710/FEU to the West Mediterranean and $4,690/FEU to North Continent. Platts Container Rates for these routes were assessed on Nov. 10 at $2,100/FEU, $2,250/FEU and $2,050/FEU, respectively.
The sharp increase of the December GRI reflects many of the fees already being applied for shippers to prioritize their export cargoes for Asia to Europe and North America, essentially guaranteeing on-time loading and delivery amid an increasingly severe shortage of containers at Asian ports as end-of-year holiday restocking continues. Containers have been piling up for months at destinations in Europe and North America as ports abide social distancing protocols related to the coronavirus pandemic, limiting the number of port workers that can be deployed to clear the backlog, based on information from S&P Global Platts.
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