According to UPS Freight And Logistics Weekly News And Market Update on December 15, 2022,
Top Takeaways
Air cargo traffic is expected to double within the next 20 years, and freighter fleet expansion is predicted to grow by more than 60%.
Air Cargo rates out of China have seen a 20% increase due to increased demand for airfreight and the reduced belly capacity.
Following the harsh weather conditions and poor visibility, air traffic control restrictions and disrupted airport operations are expected at UK's London Heathrow, London Gatwick, and London Stansted Airports.
North Smerica
Air: Last week, workers at 15 US airports including Dallas, Los Angeles, Miami and New York organized a rally and a strike to call for better working conditions. Disruptions were caused as a result at the striking airports.
Ocean: After many months of showing a TEU growth year over year, the Georgia Ports Authority has reported a 6.2% decrease (30,866 TEUs) in November compared to the same month last year. One of the major reasons is due to inflation and reduced demand.
Latin America
Air: Through its partnership with Brazilian airline, Azul, Air Europa is expanding its destinations in Brazil. Air Europa will start operating to Salvador, Bahia, starting December 15, increasing the cargo capacity between the two regions.
KLM airline is planning to increase its flight frequency between Costa Rica and Amsterdam, NL, offering three flights per week from now until May 8, 2023
Asia-Pacific
Air: Air Cargo rates out of China have seen a 20% increase due to increased demand for airfreight and the reduced belly capacity.
Asia Pacific flights to the US, including Los Angeles, Orlando and New York have been affected by the cabin crew shortages and weather conditions, which has caused delays and disruptions due to the cancelation of some flights.
Ocean: As of December 12, carriers have announced 66 blank sailings for the Transpacific Eastbound trade lane. For January 2023, carriers have announced 40 blank sailing for the Transpacific Eastbound Lane.
The Korean transportation union strike ended on December 9, however delays are still expected as they work through the backlog.
Europe
Air: Air France resumes flights from Paris to Newark Liberty International Airport and JFK Airport after ten years. While only 40 flights will operate in December, flights will increase in January. Air France is expected to operate with up to 62 flights each month, reaching its peak between April to September 2023, providing significant cargo belly capacity.
Following the harsh weather conditions and poor visibility, air traffic control restrictions and disrupted airport operations are expected at UK's London Heathrow, London Gatwick, and London Stansted Airports.
UK Border Force (UK BF) will strike later this month due to dispute over pay in Heathrow all terminals, Birmingham, Cardiff, Gatwick, Glasgow, Manchester, and Newshaven from December 23 - 25 (including shifts starting on December 25 rolling into December 26) and December 28- 30 (including shifts starting on the December 30 rolling into December 31). Significant disruptions and delays are expected during and following the strike dates.
Ocean: The Port of Felixstowe has introduced autonomous terminal tractor units (ATs) supplied by Westwell into their container terminal operations. The driverless vehicles utilize a digital map loaded to a fleet management system, enabling vehicles' navigation around the port. The ATs will increase efficiencies as they transport containers between Trinity and North Rail terminals in the port.
On December 7, a renewed cooperation agreement was signed between The Belgian Port of Antwerp-Zeebrugge and the Port of Nagoya in Japan to increase trade relations and collaboration, specifically for the export and import of cars and energy transition.
On December 8, negotiations regarding the Collective Labour Agreement (CLA) started between the unions and the APM Terminals Maasvlakte II. According to this go-slow action, the number of moves per hour conducted at the terminal is reduced, delaying the vessel operation time and disrupting regular schedules. The Danish company is considering alternative solutions for operations, including diverting vessels to other terminals.
Ground: Railway workers' strikes will continue in London until Saturday, December 17. Significant disruptions in train schedules are expected.
India, Middle Eat, and AFrica
Air: From May 10, 2023, to October 29, 2023, Icelandair will start three weekly flights between Reykjavik and Tel Aviv, Israel, from Keflavik Airport. Cargo capacity is expected to increase.
Etihad Airways of UAE will reintroduce four A380 aircraft in the summer of 2023 with operations to London Heathrow Airport. The new A380 aircraft will enable increased flight frequencies as well as new destinations, in addition to increased cargo capacity.
Abu Dhabi's Wizz Air has officially announced its first route from Abu Dhabi International Airport (AUH) to Uzbekistan's Samarkand International Airport (SKD). There will be two flights per week throughout December before increasing to three flights per week starting on January 10, 2023.
Ocean: United Arab Emirates president inaugurated the expansion of Khalifa Port with an investment of $1.1 billion. The project will support AD Port Group's container handling capacity expansion to 15 million TEUs annually and increase the general cargo handling capacity to 25 million by 2030.
The Government of Sudan has signed an agreement to construct and operate the Abu Amama port on the Red Sea with a $6 billion investment from the AD Ports Group and Invictus Investment. The project will include an economic zone, an airport, and an agricultural zone, and the port will handle a variety of commodities.
Custom and Brokerage
Foreign and Domestic facilities producing food, medical devices, or both that fail to properly renew their registrations with the Food and Drug Administration risk being banned from the American market. This year is the deadline for both types of facilities' renewals. Failure to register can result in the facility being prohibited from importing or exporting food into or from the US.
Supply Chain and Market News
According to Boeing's 2022 World Air Cargo Forecast (WACF), air cargo traffic is expected to double within the next 20 years, and freighter fleet expansion is predicted to grow by more than 60%. Additionally, more fuel-efficient and sustainable alternatives like the 777-8 Freighter will be necessary to meet the increased demand.
According to the United Nations Conference on Trade and Development (UNCTAD), the decline experienced in global trade in Q3 2022 is predicted to worsen in 2023. Even with reshoring and near-shoring, sourcing diversification, and sustainability positively influencing trade in the upcoming year; UNCTAD expects the demand to significantly soften in 2023 due to lower economic growth, high energy prices, and the high price of goods.
EU Energy Updates:
- Global LNG supply is predicted to grow by just 20bcm next year, with 1/3 of it to be provided by the US.
- The European Union energy ministers' meeting took place on Tuesday, December 13, to strike a deal on a bloc-wide price cap on natural gas prices. However, a final decision was not reached as the dispute continues among member states. The next meeting will be held on December 19, in hopes of reaching an agreement.
- On Tuesday's meeting, the Czech Republic, currently holding the EU's rotating presidency, proposed €200 MWh/h if prices on the Dutch Title Transfer Facility (TTF) gas hub's front-month contract exceed €200 MWh/h for three days and TTF's price would be €35 more than a reference price for LNG. Permits for renewable energy projects were also on hold as an agreement on gas price caps is prioritized.
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Published on December 16, 2022 9:59 AM (GMT+8)Last Updated on December 16, 2022 9:59 AM (GMT+8)
