Weekly Air Operations Update: Shanghai to Europe, US and Australia 28/10/22

Shanghai to London

• Rates to LHR are at a high level due to commercial flight cancellations and a large export volume of e-Commerce goods
  
• Operations staff are under a closed-loop management at PVG airport, so they have enough staff to handle the operation of commercial flights
• The delivery trucks need to wait outside the warehouse for unloading for 3-4 hours
• CA has cancelled direct flights ex PEK to LHR since the beginning of October; MU will cancel their direct flights ex PVG to LHR of 29 Oct and 30 Oct
• No weather disruptions
• Space is currently tight
• Rates trending upwards; rates are expected to increase until the middle of December

Shanghai to New York

• Demand to East US is low
• Operations staff are under a closed-loop management at PVG airport, so they have enough staff to handle the operation of commercial flights
• The delivery trucks need to wait outside the warehouse for unloading for 3-4 hours
• No cancelled flights noted
• No weather disruptions
• Space is currently open
• Rates trending downwards; the current rates to East USA are at a low level, but may be increased from November due to the incoming Christmas period

Shanghai to Los Angeles

• Demand to West US is low
• Operations staff are under a closed-loop management at PVG airport, so they have enough staff to handle the operation of commercial flights
• The delivery trucks need to wait outside the warehouse for unloading for 3-4 hours
• No cancelled flights noted
• No weather disruptions
• Space is currently open
• Rates trending downwards; the current rates to West USA are at a low level, but may be increased from November due to the incoming Christmas period

Shanghai to Frankfurt

• Rates ex China to FRA have been stable for the last two months
• Operations staff are under a closed-loop management at PVG airport, so they have enough staff to handle the operation of commercial flights
• The delivery trucks need to wait outside the warehouse for unloading for 3-4 hours
• No cancelled flights noted
• No weather disruptions
• Space is currently open; various carriers have daily freighter flights ex Shanghai to Frankfurt.
• The current market rates are stable, but may be increased from mid-November due to the incoming Christmas period

Shanghai to Melbourne

• The export volume ex Shanghai to Melbourne is stable unless there is a large demand of PPE from Australia
• Operations staff are under a closed-loop management at PVG airport, so they have enough staff to handle the operation of commercial flights
• The delivery trucks need to wait outside the warehouse for unloading for 3-4 hours
• No cancelled flights noted
• No weather disruptions
• Space is tight due to the limited capacity of passenger flights; all freighter flights ex China to Australia have been cancelled since the beginning of 2020
• Rates are currently stable; they may be increased from mid-November due to the incoming Christmas period

Shanghai to Sydney

• The export volume ex Shanghai to Sydney is stable unless there is a large demand of PPE from Australia
• Operations staff are under a closed-loop management at PVG airport, so they have enough staff to handle the operation of commercial flights
• The delivery trucks need to wait outside the warehouse for unloading for 3-4 hours
• No cancelled flights noted
• No weather disruptions
• Space is tight due to the limited capacity of passenger flights; all freighter flights ex China to Australia have been cancelled since the beginning of 2020
• Rates are currently stable; they may be increased from mid-November due to the incoming Christmas period

Market intel

• Recent Lockdowns in China Threaten Supply Chains
  According to The Loadstar, despite the weaker peak season we’re currently seeing, lockdowns in key Chinese port cities are yet again posing threats to supply chains. Ningbo, Shanghai, and Tianjin are among the cities experiencing small range of lockdowns due to Covid-19 restrictions.
• N. China:
  TPEB demand to USEC and midwest is low, while capacity to USWC and EU destinations is a bit tight due to commercial flight cancellations. Rates have increased on both the TPEB and Far East Westbound (FEWB) tradelanes but are overall trending at low levels. In regards to the Covid situation in Ningbo, the local authorities have tightened epidemic control measures and announced that the city will enter static management starting from Oct 16, with citizens encouraged to stay at home. All warehouses in the Beilun area are shut down. Other operating warehouses are expecting low inbound volumes due to Covid restrictions. Some cities also enacted a few restrictions for truckers from the whole Ningbo area. Air operations ex-Shanghai are unaffected.
• S. China:
  Capacity has returned to the market after the long holiday, but that market remains soft. Mainland China rate levels have decreased while rates ex-Hong Kong have increased.