Freight and Logistics News and Market Update - Week of January 19, 2023

• Air Cargo experienced a weak end to 2022, which is expected to continue into midyear 2023. Retail inventory clearance may signal better demand by summer but will likely be impeded by a looming economic recession.
• The Covid-19 pandemic continues to significantly impact China’s economy. An increase of only 3% represents the country’s lowest level of economic performance in almost 50 years.
• Georgia Ports reports having handled nearly 6M TEUs last year, an all-time high record representing a 5% increment over the previous year. The volume increase in 2022 has prompted the Port of Savannah to implement several renovation projects to attract even more volume in the future.
• The Port of Brindisi in Italy has received an investment of $65 million to widen the port for roll-on roll-off ships. This will enable shipments to be loaded onto trucks at the departure point and make way to its destination on the same truck, saving time on stowing and loading. The expansion plan is predicted increase volume capacity by 1 million tons.

Air

• Effective April 15, 2023, American Airlines will increase their flight frequency from Charlotte, NC, to London Heathrow Airport. This will increase the cargo capacity between the two regions.

Ocean

• Georgia Ports reports having handled nearly 6M TEUs last year, an all-time high record representing a 5% increment over the previous year. The volume increase in 2022 has prompted the Port of Savannah to implement several renovation projects to attract even more volume in the future.
• The spot rates to both the US West Coast and East Coast have experienced a 36% contraction since December 1. This contraction should continue as congestion issues on the east and gulf coasts improve, and volumes on the Trans-Atlantic trade route slow down.

Air

• Brazil’s Azul Cargo Express is opening three new stores in Juina, Mato Grosso, Nova Lima, Minhas Gerais, and Espirito Santo in early 2023. This will increase cargo capacity domestically within Brazil and internationally.
• JetSmart announced more passenger flights between Santiago de Chile and Rio de Janeiro, Brazil, starting February 8. The increase in passenger flights will provide more cargo space.
• Airports in Peru have been experiencing recent closures. The Cusco (CUZ) airport was closed on January 13 and Juliaca (JUL/SPJL) airport will be closed from January 13 – 22. Air cargo moving within Latin America could experience delays or disruptions due to the closures.

Ocean

• The governor of Sao Paulo is planning to meet with the president of Brazil later this month to discuss the privatization of the Port of Santos. No decisions have been made, however the federal government has stated that they would not move forward with privatization.

Air

• Carriers will add extra capacity in China by offering more freighter and passenger flights to and from Shanghai in February. The carriers will offer eight dedicated freighter flights between Abu Dhabi and Shanghai, which will increase the total cargo capacity out of Shanghai to 850 tons per week.
• The world’s largest cargo airport, Hong Kong International, registered a 16.4% volume decline from last year. Air cargo was largely impacted by global economic uncertainties, Covid-19 restrictions, and disruptions to global supply chains.

Ocean

• The volume of imports from Asia to the US West Coast continues to decline as concerns over contract negotiations and rail service issues persist. Retailers intend to keep routing their cargo both to the Gulf and East coast ports, as reported by the Journal of Commerce.

Air

• Ryanair is planning to launch new routes from London, United Kingdom, in the summer contributing to a total of 3,000 flights per week departing from London. Destinations include Edinburgh, Belfast, Cornwall, Asturias, Leipzig, and Klagenfurt. An increase is predicted in cargo capacity in the following months.
• Air France will launch three Beoing 777-300ERs flights for the 2023 winter season. The first flight will fly to New York’s JFK airport on January 20, followed by Rio de Janeiro, Brazil, on January 21, and Dakar, Senegal, on January 22. Mild cargo flow (222,000 lbs capacity per flight) between France and the three regions can be expected.
• Starting on May 24, Britain’s easyJet will relaunch flights between London Southend Airport and Amsterdam Schipol Airport four times a week after stopping service amid the pandemic. Limited cargo flow is expected between the regions.
• Finnair will serve over 50 destinations in Europe in the summer of 2023. Frequencies will increase to destinations including Ljubljana, Berlin, Copenhagen, Vilnius and Riga. Cargo flow and cargo capacity are expected to increase in the summer.
• On January 25, Challenge Airlines will launch two weekly Boeing B747F flights with a capacity of 240 tons from Istanbul Airport to Liege, Belgium. The freighter will carry various exports from Turkey, including garments, fabrics, and automotive parts across Europe, the US, the Far East, and Israel.

Ocean

• A total of 114 million euros has been invested at the Port of Setúbal in Portugal. Investments include railroad access and a roll-on roll-off terminal. 40 million euro was invested to develop the Sapec dry bulk terminal by 2026 in addition to a multi-use terminal which will have a 300 meter loading bay.
• The Port of Brindisi in Italy has received an investment of $65 million to widen the port for roll-on roll-off ships. This will enable shipments to be loaded onto trucks at the departure point and make way to its destination on the same truck, saving time on stowing and loading. The expansion plan is predicted increase volume capacity by 1 million tons.

Air

• On January 20, following the easing of Covid-19 restrictions, Emirates will launch two weekly flights to Shanghai Pudong International Airport (PVG) and Beijing, China from Dubai International Airport (DXB) with a stop at Bangkok Suvarnabhumi Airport (BKK) on the return trip. Emirates announced it will double the weekly flights on February 2 and on March 1 the DXB – PVG route will start operating daily. Cargo flow and capacity will gradually increase within the next two months.
• Beginning on March 29, Emirates will resume its direct flights to and from Hong Kong. The Dubai-based carrier will serve 44 destinations by the end of summer 2023. The carrier will enable direct flights to Hong Kong International Airport or offer a break at Bangkok Suvarnabhumi Airport. Cargo flow can be expected to increase between the two regions.
• Bahrain’s Gulf Air announced new routes for summer 2023. On March 27, Gulf Air will operate between Bahrain International Airport and Goa Dabolim (GOI) in India four times a week. On June 3, it will operate to Alexandria (HBE) and Sharm El Sheikh (SSH) in Egypt twice a week. Additional destinations include Mykonos, Nice and Malaga. Additional cargo capacity can be expected for cargo shipments.
• Beginning October 1, Etihad Airlines will launch four weekly flights to Copenhagen, Denmark and three weekly flights to Düsseldorf, Germany from its Abu Dhabi hub. Growth in cargo flow is expected with Boeing 787-9 aircraft having the cargo capacity of 60.395 kg per flight.

Ocean

• On January 20, Ocean Network Express (ONE) will increase its Maputo/Mombasa India Middle East service (MIM) sailing frequency from once every two weeks to weekly. The service rotation will continue to be Jebel Ali, Mombasa, Maputo, back to Jebel Ali.
• Mawani, the Saudi Ports Authority, announced a net trade link, the Indamex 2 (IN2) to Jeddah Islamic Port to position Jeddah as a key East to West hub. The new trade link will provide access to significant trade gateways across the Indian Subcontinent and North America.

• Customs Border Protection (CBP) began detaining goods from three Chinese companies on December 5 due to a violation of the Countering American Adversaries Through Sanctions Act (CAATSA). Importers will continue to see holds at all US ports of entry unless there is clear and convincing evidence to the contrary.
• The US and Japan are teaming up to combat forced labor violations in supply chains. The task force will exchange information on laws, policies, standards, and guidance on forced labor as they strive to contribute to resilient and sustainable supply chains.
• Mexico and Canada could impose billions of dollars of retaliatory tariffs on US exports if the three countries aren’t able to resolve a dispute over US automobile rules of origin under the US-Mexico-Canada Agreement (USMCA).

• The Covid-19 pandemic continues to significantly impact China’s economy. An increase of only 3% represents the country’s lowest level of economic performance in almost 50 years.
• Air Cargo experienced a weak end to 2022, which is expected to continue into midyear 2023. Retail inventory clearance may signal better demand by summer but will likely be impeded by a looming economic recession.

Europe Energy News

• The UK’s current six-month energy support program of 75 pounds per MWh for gas and 211 pounds per MWh for electricity, equivalent to 18.4 billion pounds, will end in March. Between April 2023 and March 2024, the government will provide most businesses with a discount of 6.97 pounds MWh for gas and 9.61 pounds per MWh for electricity.
• Starting in March, Germany will provide a discount of 0.12 euros per kilowatt-hour for the first 80% of small-to-medium-sized firms for 14 months. Whereas large businesses will pay 0.068 euros per kilowatt-hour for the first 70% of firms for 16 months. Germany also plans on lowering the value-added tax on natural gas to 7% from 19% by the end of March 2024.