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27/04/2022 15:33

The weekly newspaper for air cargo professionals No. 1,184

13 JUNE 2022

UPS names UK, Ireland and Nordics chief ...

Page 4

INSIDE

CLIVE SEES CLOUDS AHEAD ..

AZURA TO PARTNER NEW SINGAPORE SHOW

-Z Group (Azura International) - publishers of Air Cargo Week – has been selected as the exclusive appointed partner for the new air cargo Southeast Asia exhibition and conference. It is scheduled to take place at the Sands Expo and Convention Centre, Marina Bay Sands, Singapore on 13-15 September 2023. Signing the co-operation agreement in London last week, A-Z Group director Norman Bamford said: “This agreement means that we have responsibility for advertising and promoting the event and recruiting exhibitors and sponsors throughout Europe, the Middle East and the Americas. There is clearly a demand for such a gathering and it is poised to become the most influential meeting place for the air cargo community in the Southeast Asia region. “We are delighted to have been awarded this contract and will shortly be communicating full details of the opportunities to our many industry contacts.” He added: “air cargo Southeast Asia is organised by MMI Asia Pte, the regional subsidiary

GENERAL air cargo market volumes fell 8% year-over-year in May compared with April, according to CLIVE Data Services. ... PAGE 2

IAG RESTARTS CARGO FLIGHTS

IAG CARGO has restarted its cargo-only services between London Heathrow and Hong Kong and between Heathrow and Bangkok ... PAGE 2

of Messe Muenchen GmbH which owns a highly successful portfolio of major industry events including air cargo Europe, air cargo China and air cargo forum Miami with which we have been associated for many years, so we are very pleased to accept this additional role.” A further advantage of the new event is that it will be co-located with a transport logistic presence which in the other locations has proved to be valuable in attracting many more exhibitors and visitors from the forwarding and shipper communities. Expressions of interest in exhibition stand bookings are already being received and further details can be obtained from: sales@azurainternational.com. air cargo Southeast Asia, an international industry gathering for the global air freight industry, will be co-located with transport logistic Southeast Asia. The event is poised to be one of the most important business platforms for the air cargo sector, where international air cargo professionals will convene to network, make new contacts, develop upcoming

markets and explore joint business potential. Exhibitors at air cargo Southeast Asia will include airlines, airports, forwarding agents, cargo handling companies, express services, logistics providers and others. The high-calibre conference will bring together top experts from all around the world where industry representatives come together on this platform to discuss key topics affecting their business. With a programme dedicated to current industry trends and challenges, recognised experts will present new methods and innovative approaches and solutions. Delegates will get to enhance knowledge of industry trends and gain insights into the future. air cargo Southeast Asia is an opportunity for exhibitors and experts from the region and beyond to build valuable contacts, exchange views and pioneer concrete business deals. It is poised to become the most influential meeting place for logistics, mobility, IT and supply chain management in the region.

BRUSSELS INVESTS €70 MILLION ...

BRUSSELS Airport is to invest €70 million over the next three years to redevelop its cargo area ... PAGE 4

KEEPING AIRFREIGHT SAFE 24/7 ...

The airfreight sector is constantly at risk of falling victim to a wide array of threats. These can range from the terrorist to the accidental ... PAGE 7

aircargoweek.com

NEWS

Airfreight analyst CLIVE sees clouds ahead on the horizon

GENERAL air cargo market volumes fell 8% year-over-year in May compared with April, according to CLIVE Data Services. The industry analyst, part of Xeneta, said that the aviation industry’s stuttering recovery was compounded again by macroeconomic events, which show no sign of abating. The latest weekly market data also provided a glimpse of how major air cargo markets may perform in a post-Covid world, it added. May 2022 data shows air cargo demand 8% lower than in May 2019. Available capacity in the month of May was 4% higher versus the same month of last year but still down 12% compared with May 2019. Lower demand and increased capacity in this latest reporting period also led to a 9% pt drop in CLIVE’s ‘dynamic load factor’ last month versus May 2021, which resulted in a global load factor in May 2022 of 60%. These factors contributed to a further slowing down of airfreight rate increases. Rates in May 2022 were 16% up versus 2021 and 134% versus 2019. In April 2022, corresponding figures stood at +26% versus 2021 and +145% versus 2019. Air cargo market performance in May was affected by the continuing war in Ukraine, the cost of living crisis causing consumers to watch their spend more carefully, stock market declines, higher interest rates, Covid-related restrictions in China and more warnings of global recession. May’s market data showed, once again, how susceptible air cargo is to macroeconomic events, said Niall van de Wouw, founder of CLIVE and now chief airfreight officer at Xeneta. North Atlantic air cargo data in May 2022, he added, may provide a test case for the di-

rection of other markets once they also return to their pre-Covid levels. The Europe to North America market has “changed profoundly in the last eight weeks from load factors of 82% in March to 64% in May. May’s dynamic load factor was also 22% pts lower than in May 2021, while, in March, load factor on this lane was -7% pts lower. So, this is not just seasonality, it is the capacity coming back into this market. In March it was 44% higher than in 2021 and in May around 82% higher. This is a big swing, and it emphasises the jump in the cubic capacity on these routes.” Airfreight rates have continued to drop since the return of more passenger flights and the introduction of airline summer schedules. In the last week of May 2022, rates from Europe to North America showed negative year-overyear growth for the first time in two years. “The Atlantic market is interesting to follow - to see how rates shift in the coming months, as it might be a bellwether on how other markets will develop when the capacity of passenger flights returns to its former level and beyond. We sense an anticipation of a slower summer market, followed by hope for growth in the third quarter as is traditionally the case, but the market does not look great right now. There are more clouds on the horizon than there were two months ago,” van de Wouw said. One light on the horizon for air cargo volumes might stem from the outcome of the current labour negotiations at US west coast ports and any potential future disruption to the ocean market across the Pacific, which he describes as “another example of an external event that has nothing to do with airfreight that could still have a profound impact on the market.”

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ACW 13 JUNE 2022

IAG Cargo restarts freighter-only flights to Bangkok and Hong Kong IAG CARGO has restarted its cargo-only services between London Heathrow and Hong Kong and between Heathrow and Bangkok. Daily flights from to Hong Kong resumed on 1 June and four-times-weekly flights to Bangkok on 24 May. IAG Cargo has completed over 250 cargo-only flights between London Heathrow

2022 and beyond. It says that the pandemic has “turbocharged” an existing trend for the online purchase of goods and services which has continued. Pharmaceuticals, perishables and European supermarket goods are also flown into the region. IAG Cargo’s regional commercial manag-

and Hong Kong since April 2020, carrying mainly PPE including hand sanitizer, gloves and masks. Three months into the pandemic, this was followed by a major uplift of e-commerce shipments of high tech goods and as more people worked from home. In 2021, IAG Cargo saw a 32% increase in demand for its Prioritise service, which is popular with e-commerce customers, and anticipates that this will continue to be a major growth sector for the business into

er UK and Ireland, Daniel Byrne, said: “Hong Kong and Bangkok are an important part of our network with goods manufactured in the Far East popular with consumers across the world. With summer shaping up to be a busy period for IAG Cargo and our customers, this airbridge is vital for the movement of e-commerce and perishable foodstuffs, which are in high demand throughout the year.”

Antonov Airlines delivers power to the people ANTONOV Airlines working with Chapman Freeborn Germany has completed three AN124-100 flights to transport a new mobile gas power plant generator and equipment from Ljubljana, Slovenia, to Kano, Nigeria. The cargo, including generator, turbine and additional equipment, weighed about 200 tonnes. The project has been a year in the making. Antonov Airlines commercial executive, Eugene Kiva, said: “The entire team, from commercial to operational, route planning, and load planning, worked closely with our client and agents to ensure the safe delivery of this important cargo, which will support energy needs in Nigeria. “Our professional flight crew and technical staff ensured the flights went smoothly and the cargo arrived safely and on time ready to serve its humanitarian needs.”

Ukraine-owned Antonov continues to fly worldwide, prioritising flights for the Ukrainian government, the Strategic Airlift International Solution (SALIS), and humanitarian missions. It is also handling commercial flights using its fleet of five AN-124-100s. “We continue to operate despite the challenges we have faced after the Russian invasion and the damage they caused to our Gostomel home base and some of our aircraft,” said Levgen Gavrylov, acting director general of Antonov Company. “The services responsible for planning the transportation and maintenance of aircraft have been temporarily relocated to Leipzig, Germany. “This allows us to ensure the further safe operation of Antonov fleet aircraft,” he emphasised.

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08/06/2022 11:52

NEWS

Brussels invests €70 million to update cargo area BRUSSELS Airport is to invest €70 million over the next three years to redevelop its cargo area. The work, which the airport says is needed to meet growing demand for storage and handling space and the need to modernise several buildings, started in early June. Demolition of eight obsolete buildings will be followed by the start of construction work at the end of 2023. The redevelopment of the central area of the cargo zone and the development of new cargo buildings and offices will allow the airport to welcome new partners and offer larger, more efficient, more modern and sustainable buildings, it said. “Accelerating the development of the cargo zone is one of the priorities within the new strategy of Brussels Airport,” points out Brussels Airport Company CEO, Arnaud Feist. “We want to further strengthen our position as a global cargo hub and develop the cargo area in a sustainable way in order to offer our logistics partners the most efficient infra-

structure and operational processes.” By the beginning of 2025, three new modern and sustainable buildings will be opened in the heart of the Brucargo Central zone. The move follows the development of Brucargo West, the new Animal Care and Inspection Centre two years ago and the new Swissport Cargo building. Some €70 million will be invested in the redevelopment of the 83,500m² central area. “Our cargo activities are growing steadily and our cargo area is constantly developing,” continues Feist. “The demand from current and future partners for storage and handling capacity is very high. Even though the cargo area of Brussels Airport is already very large, it is important to rethink and reorganise space for more efficiency, but also and especially to modernise them. “Sustainability plays a key role in this modernisation. Brussels Airport wants to improve the energy efficiency of its entire infrastructure, a strategy that applies far beyond the cargo area.”

WFS and Bangalore sign ‘landmark’ India deal Worldwide Flight Services (WFS) has been awarded a 15-year license to operate its first cargo handing operation in India, at Kempegowda International Airport, Bengaluru. WFS is entering a new partnership with Bangalore International Airport (BIAL) which, in May 2023, will assume responsibility for the development, operation, management and maintenance of one of the cargo terminals at India’s third-largest gateway for international cargo. WFS will also operate and invest in the expansion of the airport’s dedicated cold chain facility. The WFS cargo terminal has capacity for 210,000 tonnes a year and, from May 2023, will be used exclusively by WFS to handle international cargo. WFS will reorganise and refurbish the facility to increase its throughput to over 250,000 tonnes annually. As operators of the dedicated cold chain facility at the airport, WFS and BIAL will begin a two-phase expansion, initially doubling its capacity to 80,000 tonnes per annum before increasing to over 150,000 tonnes after completion of phase two. WFS CEO Craig Smyth described the partnership with BIAL as: “a landmark collaboration” at one of the world’s most exciting air logistics hubs, adding: “WFS has been waiting a long time to establish its own presence in India. We are honoured to have earned this opportunity to work with the very accomplished and ambitious team at BIAL to realise the outstanding potential of BLR Airport. “This is already a very successful airport,

ACW 13 JUNE 2022

supported by a thriving manufacturing and services industry, and a highly skilled regional workforce. To this, WFS will add our highest international standards for safety, security and operational excellence, our ability to invest in optimising and expanding BLR Airport’s cargo infrastructure, and our global relationships with airlines and freight forwarders,” he said. WFS’ group chief commercial officer, Barry Nassberg, said: “Few airports in the world combine the growth generators we see in Bengaluru, making this long-term partnership with BIAL a big step in our expansion in Asia. This is a premier airport that understands its potential and recognises the way to achieve its growth ambitions is to work with an industry-leading global partner like WFS. “Together, BIAL and WFS will work to sustain growth in the long-term and to achieve the airport’s goal of creating a robust ecosystem that can cater for up to one million tonnes of cargo a year.” BIAL’s chief strategy and development officer, Satyaki Raghunath, said: “We welcome this opportunity to partner with a world leading global cargo handling organization such as WFS – this will support us in strengthening our position as the preferred cargo gateway in South India. With this partnership, BLR Airport will be able to offer more modern and efficient facilities to our customers. With these improvements, we are confident about being able to grow our cargo volumes and services even more rapidly to meet demand.”

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08/06/2022 11:32

DANGEROUS GOODS

KEEPING AIRFREIGHT SAFE

he airfreight sector is constantly at risk of falling victim to a wide array of threats. These can range from the terrorist to the accidental and can come from bio-security and explosive threats, IT and simple criminal theft of airfreight shipments. Given that some of the world’s most valuable and sensitive cargo is shipped by air, it comes as no surprise that these volumes are an attractive target for criminals. According to UK firm Redline Security, responsibility for security in the air cargo chain is for every person working in the sector. The Doncaster-based company considers it does not matter if you are the cleaner or the Directed Party of a Cargo Regulated Agent; if you have unescorted access to a restricted area, you need formal regulatory mandated Cargo security training. “Our cargo course ensures that all personnel with access to, or responsibility for driving, handling, screening or even managing secure air cargo have the necessary knowledge and skills required to undertake their role in a regulatory compliant and effective manner,” says the company.

Imminent threats The gamut of security threats can be divided into physical and digital versions. In terms of physical threats, these range from potential plots to place explosives aboard aircraft; illegal or accidental shipments of hazardous materials; criminal activities such as smuggling and theft; and potential hijackings and sabotage by persons with access to aircraft. Digital threats can encompass malware, deliberate re-direction of shipments and financial threats to companies. Dangers in the supply chain can extend well beyond the aircraft and away from the apron to warehousing and even road feeder services. This has been recognised as the European security system ICS for risk assessment/crisis prevention is entering its second phase. This will become concrete for airfreight shipments from third countries entering the EU starting in March 2023. “The next-stage procedure ICS2 will bring improvements for the participants, especially with regard to competition protection,” emphasises Simon Lembke, director of customs and forwarding applications at DAKOSY. Hamburg software provider DAKOSY is prepared with new processes and interfaces. As a result of the 9/11 terrorist attacks, the ICS procedure was introduced for the declaration of goods prior to entry into the EU for risk assessment/crisis prevention. With ICS2, the EU is centralising declarations by carriers with a cargo advance information system: as of March 2023 for airlines and as of March 2024 for shipping companies. Lembke summarises the most significant changes: “In the future, declarations will be sent directly to the new EU system, the Shared Trader Interface (STI), and must be provided before the goods are loaded. In comparison, previously the entry declaration had to be submitted electronically no later than four hours before arrival at the customs authority where the goods first reached the borders of the EU.” While potential risks associated with air cargo security include the wilful introduction of explosive and incendiary devices in cargo placed aboard aircraft, the shipment of undeclared or undetected hazardous materials aboard aircraft are probably the more likely danger to be faced by carriers. Amid a number of recent fire incidents affecting air cargo movements allegedly involving lithium batteries, international freight

ACW 13 JUNE 2022

FEATURE

AFE 24/7 transport insurer TT Club has called for increased vigilance to ensure a secure safety environment for the fast-developing supply chains of this increasingly common component. The market is exponentially increasing through consumer demand for a wide variety of rechargeable products from handheld devices to power tools and electric vehicles. “Understanding the risks is crucial,” comments TT’s risk management director, Peregrine Storrs-Fox. “As with many successful technologies, market demand has outpaced the development of safety regulations. Since the mid-1980s, lithium batteries have been classified under dangerous goods regulations for transport based on the weight of lithium contained in the cells or batteries and the potential hazard presented by a given battery is also related to the amount of lithium it contains. However, as technology has advanced, the amount of energy derived from the active material has increased by up to 50%, leading to regulatory mismatch where provisions are essentially framed around mass and energy output.” Throughout their intermodal journey, the primary risks exist when batteries are poorly manufactured, untested or defective; these have a higher propensity to malfunction. However, supply chain risk – at any point of handling, storage and transport – is compounded by used, fully or partially charged batteries. As such, the reverse logistics of batteries must be carefully managed; damaged and faulty products being re- turned or shipped as waste for disposal or recycling present increased risk. “The majority of shippers will take all practicable steps to ensure that their lithium batteries achieve certification and are classified, packaged, packed, labelled and declared correctly. A small – frankly criminal – minority are motivated to avoid compliance, entering cargo into the supply chain that presents great risk to all,” Storrs-Fox observes. “Once lithium batteries are placed into the intermodal supply chain, there is little opportunity for the cargo to be checked, visually or otherwise to verify compliance. For all who are contracted to transport, handle or store lithium batteries therefore, developing a thorough understanding of this particular cargo is a prudent step. Moreover, due diligence into the origin of manufacture and integrity of the shipper instigating the move of these potentially lethal power sources is critical.”

Canine security Engineered canine screening and detection leader Global K9 Protection Group (GK9PG) has entered a strategic partnership with Anniston, Alabama-based 360 Security Partners, LLC, known in the industry as CSK9 (Cargo Screening K9) and VWK9, as part of ongoing plans to expand services and develop new technologies in the canine security sector. “By bringing CSK9’s, VWK9 operations and assets into our headquarters and under GK9PG’s management and leadership in Opelika, we will accelerate our plans to advance the global standard in air cargo and aviation security solutions, further addressing and alleviating the ever-present supply chain issues,” said Eric Hare, chief executive officer, Global K9 Protection Group. “We look forward to the value that this partnership brings to all clients in the air cargo, aviation security, commercial services, military and law enforcement sectors.”

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