News Desk Madeleine Matheson, from Impress Communications, reviews some recent news that might impact on Members’ business

Airline profits to crash despite rise in cargo rates, says IATA

IN THE AIR IATA’s financial outlook for the global air transport industry predicts that airlines are expected to lose $84.3 billion in 2020. Although overall freight tonnes carried are expected to drop by 10.3 million tonnes to 51 million tonnes compared with 2019, cargo is the one bright spot as the severe shortage in cargo capacity is expected to push rates up by some 30% for the year. IATA forecasts that cargo revenues will reach a near-record $110.8 billion in 2020 (up from $102.4 billion in 2019), with cargo contributing approximately 26% as a portion of industry revenues – up from 12% in 2019.

ON THE OCEAN Spot rates on trades from China to Europe continued to track well above levels recorded last year as carriers match the sharp decrease in demand with equally severe cuts in container shipping capacity, according to a Journal of Commerce report in early June.

The number of vessels routed on the bunker-guzzling Cape of Good Hope route from Asia to Europe, which avoids Suez Canal tolls, continued to rise in June despite environmental protests from some shippers.

The inactive container shipping fleet had reached an all time high of 11.6% in capacity terms at the end of May, according to analyst Alphaliner, standing at 2.72 million teu, due to a combination of blank sailings to mitigate the impact of lower demand from the Covid-19 pandemic and vessels taken out of service for scrubber retrofits.


Opponents of the EC’s recent decision to allow the liner shipping industry to continue to enjoy its exemption from anti-trust consortia regulation until 2024 will be buoyed by the news that stakeholder comments could be sought as early as next year as the EC begins to evaluate extending it beyond April 2024.

ON THE QUAYSIDE The British Ports Association (BPA) has published an economic recovery plan for government including proposals for a Green Maritime Fund to drive sustainable development and help stimulate growth consistent with Net Zero aims.

Tilbury2’s new unaccompanied freight-only ro-ro ferry terminal, operated in exclusive partnership with P&O Ferries, has opened for business, injecting state-of-the-art capacity into the country’s ports

sector by utilising a truck driver-free operation.

The International Association of Ports and Harbors (IAPH) issued a new report in June providing a snapshot of the ongoing economic impact of the coronavirus on global port operations, highlighting emerging trends in operations including an increase in high- frequency feeder services to regional ports. However, other ports continue to feel the impact of cancelled container line sailings and the suspension of many ro-ro services.

Overall container throughput and international container cargo volume at eight major Chinese ports had increased 20% and 18% respectively by the middle of May, equivalent to around 98% and 96% of volumes in the same period of last year, according to Seatrade Maritime News.

IN THE SUPPLY CHAIN Manufacturers and logistics service providers must be prepared to protect their supply chains from a projected significant spike in cargo thefts as coronavirus lockdowns are lifted across the Europe, Middle East and Africa (EMEA) region, the Transported Asset Protection Association (TAPA) has warned.

The risks to freight operators from migrant ‘stowaway’ incidents continue despite the current Covid- 19 pandemic – and could escalate as restrictions on movement begin to ease, warns international freight insurer TT Club.

Existing customs centres near Ashford and Folkestone could be used to help the port of Dover manage an estimated 200 million additional customs declarations per year when the Brexit transition ends on 31 December 2020, according to the Financial Times.

July 2020

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