Weekly Air Operations Update: Shanghai to Europe, US and Australia 04/11/22

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
• MU cancelled direct flights ex PVG to LHR from 31 October until now due to the rejection of Landing permit by the UK government; CA resumed their direct flights ex PEK to LHR from 1 November
• 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 expected to increase in the coming month due to the upcoming Christmas period
• 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 currently stable but are expected to increase to a high level in the next few weeks due to increasing volumes for the upcoming Christmas period

Shanghai to Los Angeles

• Demand to West US is expected to increase in the coming month due to the upcoming Christmas period
• 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 currently stable but are expected to increase to a high level in the next few weeks due to increasing volumes for the upcoming Christmas period

Shanghai to Frankfurt

• Export volume to Europe is currently down due to the current market depression
• 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 low due to the decreasing export volume

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 open for now; 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 open for now; 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

• China Manufacturing Continues to Slow.
  As Beijing’s zero-Covid policy causes more supply chain disruption, the country’s manufacturing sector has shrunk for the third month in a row. According to The Loadstar, this is exacerbated by the softening in overseas demand and has resulted in a decline in both output and new orders.
• N. China:
  Demand remains low to U.S. Midwest and USEC destinations, while USWC capacity is a little tight due to an increase in ecommerce volume. Far East Westbound (FEWB) demand is also keeping steady. Rates to the U.S. Midwest and USEC have dropped slightly and rates to the USWC and FEWB destinations maintain at similar levels to last week. Air China will resume its freighter services ex-Shanghai Pudong (PVG) starting this month. Air China’s service has been suspended for several months so this will bring a large amount of additional capacity to the market.
• S. China:
  TPEB rates continue to drop and charter cancellations are prevalent due to the soft market. On the other hand, FEWB rates remain stable and new charters have been added to the market. The South China market has also seen some more demand coming from e-commerce clients. For Shenzhen-Hong Kong (SZX-HKG) cross-border trucking, continue to expect 2 days of additional transit time.