Airfreight shipments grow amid US port congestion—Drewry

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Port of Los AngelesAir cargo has received an unexpected demand push from the U.S. West Coast port congestion as some shippers are opting for air transport to ensure their products reach U.S. stores in time for the holiday season, according to a report by Drewry Maritime Research.

In its latest analysis, Drewry said the port congestion has benefited the airfreight sector as forwarders use it as an alternative mode of transport to the U.S., but it does not expect the situation to spur a reversal of the long-term transfer from air to ocean transport.

Said Drewry: “World air cargo growth has for a number of years lagged behind container shipping growth due to a combination of factors, including higher demand for commodities that are typically shipped by ocean freight, faster growth at the low-value end of commodities such as T-shirts that reduces air cargo’s overall share and finally the sea conversion of ‘mature’ products.”

It noted that a study published earlier this year by Seabury revealed that air cargo volumes have gone down by as much as 15 million tonnes since the start of the century, with modal shift toward the much cheaper ocean freight accounting for about one-third of that figure. The shift has gathered momentum in recent years as shippers have developed more sophisticated IT systems and leaner inventory strategies.

But the research company does not expect the steady switch from air to ocean to make a turnaround, although it has observed a seeming slowdown in the trend as the container sector gets entangled in various supply issues, including poor reliability, rolled cargo, missed voyages in peak cargo months, and port congestion.

“More recent numbers show that international airfreight growth is starting to keep up with container traffic growth and even overtake it in certain months,” said Drewry.

For the short term, Drewry expects airfreight to get more action and for its rates to continue to show a rise as the shopping season hits full swing, and for demand to endure through until the Chinese New Year. “The [congestion] issue will help to inflate air rates and demand temporarily, but it will not reverse the longer-term trend towards ocean.”

As for ocean trade, “the backlog at US west coast ports has the potential to soften the traditional drop in Asia to US rates in December,” it said.

Photo: DanMS