Ecommerce growth leaves Latin America's air cargo imbalance unresolved
Growing ecommerce imports are reshaping Latin America's air cargo networks, but have yet to resolve the region's directional imbalance, with LATAM Cargo reporting that declining industrial shipments are offsetting some of the gains.
Speaking to The Loadstar at TIACA's Air Cargo Forum in Miami last week, LATAM Cargo group CEO Andrés Bianchi said stronger online retail volumes did not tell the whole story of southbound demand.
"First of all, it's important to note that ecommerce volumes have increased, but other commodities have decreased," he said.
"That means still you face the imbalance, because the export sector is doing quite well."
Auto parts and mining equipment were among the industrial goods affected, he explained. While a broader cargo mix offered diversification, greater reliance on ecommerce also introduced different risks.
"They are much more exposed to regulatory cycles than other commodities. So you have to start thinking differently in terms of the risks you have to manage when you design your operation."
For Avianca Cargo, ecommerce has become a major driver of southbound business, particularly from Miami to Colombia.
"We also move mining cargo, auto parts, and pharmaceuticals, but the biggest share and the biggest growth is ecommerce, for sure," CEO Diogo Elias told The Loadstar.
The carrier also moves ecommerce into Brazil, Chile, Ecuador, and Central America, while resumed freighter operations from Miami to Venezuela carry online retail shipments too.
But matching Latin American exports with inbound demand requires balancing a network, rather than simply filling the return leg of individual routes.
Mr Elias explained that around 90% of Avianca's South American cargo into Miami came from five principal origins. From Miami, however, the carrier served more than 30 destinations, distributing ecommerce alongside automotive parts, semiconductors, mobile phones, and other tech products.
Strong export flows also mask pressure on shippers' costs. Speaking on a separate panel, Mr Bianchi said currency appreciation and minimum wage increases had, together, raised Colombian exporters' labour costs by 40% to 45% in dollar terms over the past year.
"When you try to talk to them about higher prices when they are already facing a cost crunch, your approach has to be different, and you have to be a lot more creative," he said.
Nor does all the region's Chinese ecommerce arrive through the US. Avianca also carries shipments through Madrid, using its passenger network to connect Europe with South America.
"Our main hub in Europe is Madrid," Mr Elias said, explaining that it was the principal European gateway for the Chinese ecommerce carried by the airline.
The ability of online platforms to develop alternative markets has also changed freighter deployment, according to Atlas Air executive Martin Drew.
Following the removal of US de minimis treatment for Chinese shipments last year, platforms redirected volumes towards other destinations.
"They ramped up existing markets, or seemingly created new markets, overnight," he told The Loadstar.
"A good example was Lima in Peru. One of the biggest platforms said they now needed capacity into Lima. Today, we're still operating three flights a week from China into Lima, and that was a market they just switched over."
However, that redeployment created another challenge when US demand recovered. Aircraft committed to serving Latin America were no longer readily available to accommodate the additional US business.
"We had redirected so much capacity to Latin America that when we were asked for more capacity back into the US, there wasn't sufficient capacity," Mr Drew said.
The changing routes also reinforce Miami's role as a connecting gateway. In his conference presentation, Rotate's Ryan Keyrouse highlighted transhipments and indirect capacity serving Asia-Latin America demand, while warning that an apparent global balance between supply and demand would not necessarily be reflected on individual tradelanes.
For regional carriers, the task is, therefore, to respond to new demand without assuming today's cargo mix will remain unchanged.
Mr Bianchi pointed to the growing importance of pharmaceuticals alongside ecommerce, but noted that even high-paying commodities had distinct vulnerabilities: pharmaceutical flows, for example, could fall when patents expired and local generic production developed.
Rather than betting on a single growth sector, LATAM's approach was to retain the ability to adapt, he said.
"More than understanding and trying to bet on the next big commodity, what we're trying to do is prepare ourselves to be able to react quickly in a cost-effective fashion in order to respond very well to our customers' needs."
