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Peak season pressure to develop unevenly across origins and cargo types

The air cargo industry is preparing for the post-Golden Week peak season but demand is expected to develop unevenly depending on origin and cargo type, according to freight forwarder CH Robinson. In a market update, the US forwarder said that volumes will rebound in the coming week as factories re-open following the Golden Week holiday, with technology-related demand, such as servers, semiconductors and other electronics, remaining one of the strongest demand drivers across the transpacific. "New consumer-device launches are adding another layer of time-sensitive cargo, while general freight is expected to increase more gradually as manufacturers and retailers bring in inventory ahead of early Black Friday sales, Cyber Monday, and year-end demand," the forwarder said. However, e-commerce, which has in the past few years been one of the major drivers of air cargo demand, is predicted to play a smaller role in the peak season as a result of tariff changes in the US and Europe. If carriers adjust their schedules to capitalise on the growing tech demand to the US, this could leave shippers with goods going to Europe with fewer options, especially if they require freighter aircraft rather than bellyhold, the forwarder explained. "Airlines often respond to concentrated demand by adjusting aircraft deployment, schedules, and allocations toward lanes where booking activity is strongest," CH Robinson explained. "If more freighter capacity is directed toward US-bound services, shippers moving freight to Europe or within Asia may see fewer workable options even when demand on those lanes has not increased significantly." The forwarder added that passenger belly space can accommodate a large share of general freight, but it does not replace freighters for every commodity. Asia-origin pricing could firm more noticeably from mid-October, particularly on transpacific lanes with high concentrations of technology and new-product freight, the company explained. However, demand levels will vary between gateways. "Asia Pacific-to-US demand was already running 17% above last year in mid-September, with several technology-heavy origins showing stronger gains," it said. "Conditions will vary by origin as cargo mix, gateway demand, airline allocations, and freighter schedules shape available capacity." Another factor that may impact the peak season is typhoon season, while modal transfer from ocean due to disruption to container shipping operations has also affected the market in recent years. "If the flow of general cargo remains measured and post-holiday demand is concentrated mainly in technology and time-sensitive freight, booking limitations are more likely to remain origin- and departure-specific rather than spreading broadly across Asia." The forwarder added that the Asia-Europe trade is less broadly pressured than the transpacific, even though individual technology-heavy origins may tighten. "China, Southeast Asia, and India should therefore be evaluated separately. Local cargo mix, aircraft type, gateway performance, and airline schedules can produce very different booking conditions from one origin to another."

Colombia 'absolutely booming', as ecommerce squeezes air cargo capacity

A huge rise in Colombia's ecommerce imports are putting pressure on inbound air cargo capacity, with airlines and operators reporting thousands of tonnes arriving each week and demand for space continuing to grow. "Colombia is absolutely booming," said one airfreight wholesaler that specialises in perishables. "It's incredible the amount of business going into Colombia." The wholesaler estimated weekly ecommerce imports at 3,000 to 4,000 tonnes - a figure supported by LATAM Cargo's market intelligence. He said one customer currently moving around 1,000 tonnes a week wanted to double that volume, but all available capacity was being taken immediately. LATAM's own imported ecommerce volumes on the US-Colombia corridor rose 53% in January-August. compared with the same period last year. Simón Benzaquen, North America sales VP at LATAM Cargo Group, told The Loadstar: "This strong performance was driven by an increase in operational frequencies into Bogotá, combined with the development and expansion of new regional destinations to streamline delivery times for end consumers." Meanwhile, figures supplied by analytics company Rotate indicate that ecommerce demand is growing faster than available capacity. In its latest three-month comparison with the preceding period, Rotate recorded a 16.8% increase in ecommerce demand into Colombia, while overall cargo demand rose 1.1%. Capacity declined 6.7%. Against the equivalent three-month period last year, ecommerce demand increased 11.9%, overall demand rose 5.7% and capacity grew 4.7%. The figures suggest a tightening market for inbound space, particularly for parcel traffic. The wholesaler described a trade that pairs southbound ecommerce with northbound perishables, and said Colombia had become a recurring topic among industry contacts at the recent European cross-border ecommerce event in Liege. "Everybody I spoke to there was talking about Colombia, Colombia, Colombia," he said. LATAM estimates approximately 99% of Colombia's ecommerce import tonnage enters through Bogotá, Medellín, Cali, and Barranquilla. Its market intelligence indicates cross-border ecommerce demand has been growing at approximately 5% month on month this year. Mr Benzaquen said LATAM was developing direct import services into regional gateways to shorten delivery times and improve network efficiency. However, suggestions that the Colombian surge could partly reflect shipments being redirected to neighbouring markets remain unconfirmed. The wholesaler questioned whether some imports might be travelling onwards, to Venezuela or Brazil. LATAM, by contrast, said the import volumes it processed into Bogotá were intended for Colombian consumers. The airline also said it maintained direct access to Venezuela during the temporary disruption to its Caracas service, using recovery flights into Valencia rather than routing those shipments through Colombia. Those flights carried more than 180 tonnes of ecommerce cargo during the interruption. LATAM offers more than 100 tonnes of weekly capacity across Caracas and Valencia, which Mr Benzaquen said fully met current demand. A second weekly Miami-Caracas frequency is scheduled to begin in November, taking capacity above 150 tonnes.

Hormuz closure a fatal blow for Dubai and Abu Dhabi transhipment volumes

The closure of the Hormuz Straits, now approaching its eighth month, has been predicted to lead to the permanent loss transhipment traffic for the Gulf's two largest container facilities, Jebel Ali and Khalifa. Prior to the outbreak of the US-Israel-Iran conflict, the two UAE ports were a favoured waypoint for relay transhipment operations - boxes moving between Asia-Europe vessels and ships deployed on north-south trades. However, a combination of soaring insurance premiums on vessels passing though Hormuz and the major carriers redesigning their networks to insert alternative transhipment calls could spell the death knell for port operators DP World and AD Ports' hopes of reinvigorating their transhipment volumes when the conflict ends. "Relay transhipment doesn't come back - ever," said Eirik Hooper, Drewry's senior associate for ports and terminals said in the consultancy's Freight Loop podcast yesterday. "It's the most price elastic and least sticky cargo type in container shipping because it follows network design, not geography. "So once MSC has moved a call to Khor Fakkan; once CMA CGM has built its logistics capability at Sohar; once the carriers have rebuilt their networks around Salalah, Colombo, Vizhinjam or Jeddah, there's no case for reinstating a Hormuz transit to serve cargo that never needed to enter the Gulf," he added. And he further argued that the July agreement signed between by DP World and Fujairah Port Authority for a 50-year concession to construct two terminals outside Hormuz indicated that DP World management had likely come to a similar conclusion. Both DP World and AD Ports reported huge declines in first half volumes at Jebel Ali and Khalifa respectively, due the war, forcing their owners to look elsewhere for growth. "DP World is building 2.5m teu capacity outside of Hormuz and is marketing it as an extension of the Jebel Ali ecosystem - I don't think you can simultaneously argue for a full Jebel Ali transhipment recovery, whilst its owner is planning for the opposite," he said. At the same time, Khor Fakkan owner and operator Gulftainer has drawn up plans to take its annual capacity from 3.5m teu to 10m teu, although this appears to be partly predicated on its new role as a Gulf bypass port that has managed to keep container flows continuing into the Gulf markets. Additionally, he said there was little chance of a decline in insurance premiums for vessels transiting Hormuz: "Insurers will not restore pre-2026 pricing for a strait that's been mined and blockaded, and a hub whose access carries a persistent risk premium and cannot win price-sensitive relay cargo against a Salalah or Colombo - that's structural, not cyclical." Pre-war insurance rates for Gulf-bound ships hovered around 0.1%-0.2% of the vessel's hull value and went up to anywhere between 2.5% and 7.5%, "depending on whose book you're looking at", he noted. However, given the enormous supply chain infrastructure investment the Dubai government has made over the past four decades, Mr Hooper believed Jebel Ali would continue to have a major role to play in regional container supply chains. "There's still a big business there - [upper] Gulf transhipment plus re-export businesses, which are materially smaller, but still substantial. "It will keep its preeminence regionally because of the JAFZA free trade zone, the warehousing, the industrial cluster, the cargo airport - it's taken four decades to build that out and you can't relocate it overnight." But Abu Dhabi's Khalifa port, which has been nibbling away at Jebel Ali's dominance for the past few years, was "a bit more exposed because Kizad [the Khalifa free trade zone] can't claim the same size, longevity, or breadth of customer base to anchor it. "That's the harder conversation for that shareholder group," he added. The three big wins for Khalifa in recent years was due to a shift from a common-user terminal model to dedicated carrier terminals, developing joint-venture facilities with Cosco, CMA CGM and MSC. However, with network redesign forced upon carriers by the war, those volumes have gone elsewhere and carriers are using large amounts capital to support the new networks. "The Hormuz crisis is driving deal making directly - with Jebel Ali and Khalifa inaccessible, MSC needed a structurally safer relay hub outside the Gulf, and one where it held equity; hence it acquiring 49% of Adani's Vizhinjam for $1.4bn," he said. Despite the deal being held up by the local state authority over questions of common access, "given MSC's volumes, it's our view that it will eventually get approved rather than refused, but there may be some conditions attached," Mr Hooper said.