CANADA REPORT O


Canada’s insulated but not divorced


utside elements are providing the Canadian airfreight business with its biggest hinderance, says Nor- man Richard, director of air service development at Edmonton Interna-


tional Airport. While the slow moving markets of Canada’s


trading partners trudge along, Richard waxes lyrical about the strength and opportunity of the home markets. “For three and a half years we have seen month-on-month growth in the region of 3.5 per cent,” he says. Richard highlights one region and one sec-


tor in particular as responsible: “This growth is down to a number of factors, of course, but the oil and gas sector in Alberta is providing a lot. It is the region with the third largest oil reserves in the world.”


These opportunities have led to a lot of invest- ment in the region, with Edmonton Airport not missing out on the financial kick. So far $28 million has been invested in the development of its cargo village, with several of the buildings already in place. “We are also in discussions with road feeder services, with an eye to developing this area too,” says Richard. Although optimistic about the prospects posed by the home markets, Richard is realis- tic about the impact from the outside. “We are bucking the [global] trend and we are insulated, but we are not entirely divorced,” he adds. However, surveys conducted by Canadian bodies see the country’s export sector, espe- cially in the developing markets, continuing this growth for a further decade. According to the results of the Conference Board of Can- ada’s 2025 export predictions, released last year, exports to China, India and Brazil are all due to rise in the 13-year period, with con- sumption of Canadian goods by the Chinese expected to rise 6.8 per cent. Jim Ramsay, vice president of UPS Global


Freight Forwarding, says: “Let’s remember that the determination and resiliency of our busi- ness leaders in Canada is as strong as it has ever been. A recent survey we commissioned with Leger Marketing found that three in five business leaders believe that they will see more revenue in 2013 than they did in 2012. That said, one needs to always be aware of the challenges that face the [airfreight] industry in order to adapt to the market. “For UPS, as we move into the latter half of 2013 we continue to balance the use of com- mercial carrier and the utilisation of our own assets (over 230 aircraft), to maximise capaci- ties and efficiencies. We look for new services to meet the needs of emergency users or speciality users of airfreight, like ones in the healthcare industry; new services also help meet the vary-


ing needs of the customer.” Ramsay and his team are also leveraging the


use of technology – an asset often underused by airfreight – to control its costs, as well as to plan and improve its services. “UPS’s ability to leverage an entire for-


warding air network results in the ability to steer cargo to different gateways depending on available capacity in the market. Access to a large transportation network is key to offering customers flexible logistics solutions designed to meet the particular needs of their business,” he adds. Over the past five years all and sundry have been discussing the relevance of full-freighter


RICHARD


We have invested


$28 million in develop- ment


services in a world with more advanced ship- ping options from cheaper sources. Toronto Airports Authority’s manager for


route development, Darryl Horzelenberg, is one such sceptic when it comes to full-freighters. “My own belief is that we will see more of a


shift from freighter to bellyload and even more to ocean. Airfreight will continue to be for the higher end products and cargo companies will have to evolve their business to adapt to the demands of those products. We see that even pharmaceutical products and technology based items are starting to shift away from airfreight, especially in Asia to Europe and Asia to US mar- kets where demand is low, space is a premium and options expensive,” says Horzelenberg. That said, the full freighter industry does still bring in much needed business to Cana- da’s airports. Though he may feel that a shift is coming – bellyhold cargo currently represents 55 per cent of all freight brought into Toronto – Horzelenberg notes the efforts being made by Canadian airports, and in Toronto in particular, to attract this business. “Since 2007, Toronto Pearson has reduced landing fees for cargo carriers by more than 51 per cent,” says Horzelenberg. “However, with belly freight representing the majority of all our cargo, the more passenger carriers we cater to, the better the cargo con- nections and the service to the world we can provide,” he adds.


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ACW 9 SEPTEMBER 2013


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