Strong demand means air freight shippers must expect higher prices
Date: Thursday, April 20, 2017
Source: The Loadstar
Signs that the airfreight market is finally correcting itself are certainly apparent. Airline carriers, such as Emirates Sky Cargo and Cathay Pacific, whom are usually the first to apply rate increases, have already reinstituted a fuel surcharge. We have also seen this to be the case with many carriers out of Asia. Up until recently most airlines had moved to an all-in pricing model that showed little upward movement and was even still negotiable.
These extremely low rates were a direct reflection of the over-capacity caused by passenger demand. Airlines added additional flights to their rotation to keep up with passengers and, although air cargo demand grew, it did not grow at a rate equivalent to or greater than the growth in the passenger segment.
Additional reports have indicated that the freight load factor has improved over the past couple of months, caused by an increase of air cargo with only moderate capacity added. Many airline carriers have also canceled freighter flights, or pulled the freighter aircrafts out of rotation altogether, to further limit available space.
It was only a matter of time that we saw airfreight costs back to normal levels. This article is a reality and Laufer Group International will work closely with our clients to see them through the market changes.
-Thomas Marano, National AirFreight Business Development Manager
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