Date: Jun 19 2017
Title: Air Freight Market Update Report for Week 25


While there has been some easing of demand for space in China, much of the region finds itself in a critical situation in which available space cannot meet demand at origin or congestion is delaying onward forwarding of cargo and keeping rate levels high. Than there is Hong Kong which has no backlogs, yet is dealing with late departing planes.  Booking cargo in advance is a necessity at just about every major gateway in the region.

Following are highlights from around our Asian network.

China
Shanghai: Relatively strong demand for space to the US East Coast has enabled carriers to increase rates by approximately 5%. On the other hand, inadequate capacity is causing cargo backlogs to Canada (3 flights) and Latin America (2 flights). Three to four days advance booking is strongly recommended. 
Xiamen: Demand eased last week allowing cargo planning to go more smoothly. Carriers continue to demand 3 – 4 days advance booking to US gateways.  
Shenzhen/Guangzhou: Available space is a bit tight despite a softening in demand. 
Hong Kong: Although there are no reports of backlogs, flights departing HKG are running two – three days later than scheduled. Consequently cargo must be booked earlier in order to achieve desired transit times.

India: Airports continue to experience Customs processing delays.
Delhi: There is adequate space to meet demand and rates remain unchanged.
Bangalore: Space situation is tight and rates are still a bit high.    
Chennai: Airport operations remain very chaotic. Space is tight and bookings to the US and European gateways are delayed 3 to 4 days.  Rates remain high.

Korea: Available cargo space to US gateways remains tight due to strong demand of transit cargo (from Hong Kong, Shanghai, Vietnam) combined with strong local demand fueled by the Hyundai Motors and GM recall programs and strong export volumes by Samsung & LG.  More than 200tons of cargo is backlogged at ICN. Transit cargo is idling 2 – 4 days at ICN before departing for US gateways. 

Taiwan: The airport has a backlog of approximately 230 tons, space is tight and rates are up. The primary driver is transit cargo from Xiamen (China), Vietnam, Singapore, Malaysia and Thailand.  Onforwarding delays are running 6 – 7 days. The situation may not improve in the near term because of a major project shipment by Taiwan Semiconductor that will absorb large volumes of space on BR and CI beginning the middle of June and lasting for a month.

Thailand: Strong demand for export space at BKK and congestion at transit hubs is creating has created a tight market situation. All air carriers are accepting bookings on Express rates and demanding one week advance booking.   

Vietnam: Demand for space exceeds capacity and carriers have begun rejecting bookings even on Express rates. Transit times to the US are running between 10 to 12 days. Carriers require one week advance booking. Exacerbating the situation has been a reduction in QR’s flight schedule. 

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