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Impact of COVID-19 revealed in first half cargo capacity

The cargo capacity crunch continues even as New Zealand businesses return to a post-lockdown normal, according to the latest air freight numbers from Auckland Airport.

International air cargo data for the first half of the year to June showed that while air freight demand has declined -16 per cent year-on-year, available capacity has dropped away by -25 per cent.

Typically 80 per cent of New Zealand’s air cargo arrived and departed in the belly-hold of passenger aircraft, but border closures and a highly disrupted aviation market have had a real impact on the supply chain over recent months, says Auckland Airport general manager aeronautical commercial Scott Tasker.

“Flying product in and out of markets is essential if you’re dealing with high-value, perishable goods or want something in a rush.

“What we saw with the outbreak of COVID-19 was the urgent need, not just in New Zealand but globally, to source health, cleaning and PPE products. Some of that capacity has been filled by passenger aircraft carrying cargo only, but clearly there’s still not enough cargo space to meet demand.

“New Zealand trends are in line with what’s happening in the air cargo market around the world. There are some regional variations but on average global air freight volumes are down around -16 per cent and capacity lower still at -23 per cent.”

He says government support for airlines through the International Air Freight Capacity scheme introduced in May and now extended beyond its initial end date of June 30 until the end of August has been vital in keeping air trade connections flowing.

“But the usual pattern is for a peak in cargo volumes from around October to January, so without a border reopening or an increase in cargo flights, whether that’s freighters or cargo-only passenger aircraft, it will be a challenge to match that demand with capacity. It’s possible that a shortage of capacity could be challenge for exporters getting fresh, seasonal produce, such as avocados and cherries, to international markets.”

As New Zealand got back to a more business-as-usual environment with the move to Alert Level 1 on June 8, imports and exports moved closer to a pre-COVID pattern for the month of June.

Respiratory equipment remained the top growth category but flows of food products replaced the urgent need for COVID-related products.

Year-on-year, June tonnage fell -17 per cent, mainly due to a -24 per cent fall in imports. Capacity was down -41 per cent compared to June 2019 but 9 per cent down on the previous month, which suggest higher load factors to meet demand.

“We’ve seen relatively good volumes into the US, which is our third largest market. Export volumes were up 30 per cent on the previous month off the back of strong numbers for lamb, beef, respiratory equipment, salmon and prepared foodstuffs, and the year-on-year drop in overall freight volumes to and from the US was only -1 per cent,” says Scott.

In June, Auckland Airport had 10 airlines operating 255 international cargo flights using passenger aircraft, in addition to 113 international freighter flights.

Top export growth commodities, June (year-on-year):

  1. Respiratory equipment (+240 tonnes, +348 per cent)
  2. Lobster (+166 tonnes, +152 per cent)
  3. Lamb (+111 tonnes, +91 per cent)

Top export declines, June (year-on-year):

  1. Food preparations (-206 tonnes, -41 per cent)
  2. Fresh milk (-120 tonnes, -62 per cent)
  3. Persimmons (-107 tonnes, -58 per cent)

 

Top import growth commodities, June (year-on-year):

  1. Capsicum (+115 tonnes, +184 per cent)
  2. Coffee (+41 tonnes, +479 per cent)
  3. Food preparations (+30 tonnes, +17 per cent)

Top import declines, June (year-on-year):

  1. Vegetables (-203 tonnes, -71 per cent)
  2. Books (-168 tonnes, -64 per cent)
  3. Vehicle parts (-127 tonnes, -42 per cent)
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