AIR CARGO: THEMES FOR 2023

a much-needed demand boost as companies increase their engagement with China.”

Air to Ocean?

Murmurings in the sector are pointing towards 2023 being the year when a significant volume of air cargo will be diverted to ocean freight. Such a move follows on from the global pandemic, during which we witnessed a huge increase in air freight demand primarily due to the change in purchasing trends. Another key element was the uncertainty of the ocean freight sector, which at the time was bogged down in supply issues, delays, and bottlenecks. Hence, shippers who would otherwise have opted for sea freight shipment were forced to move their shipment via air freight because of the equipment shortage, port congestion, blank sailings, and other problems in the sea freight sector.

However, now the pandemic is all but over, and the global economy is kicking back into gear, the ocean freight sector has returned to normal. In simple terms, this means increased schedule reliability, more capacity, and, of course, lower freight rates. This change is what is driving many freight forwarders to shift to sea freight shipments to save expenses.

Sustainability is another key factor here too. With intense scrutiny on businesses to not just espouse a ‘green’ philosophy, but to actively show they are making sustainable choices while building a climate conscious operational culture, forwarders are eager to make the switch from air freight to sea freight, with the latter being far more sustainable.

Finally, the increase in belly capacity due to the easing of travel restrictions will be further supplemented by the arrival of new freight orders placed by the carriers during the peak of the pandemic. Therefore, air freight capacity will continue to increase in the coming months leading this sector to join the ocean freight industry in terms of overcapacity.

Digitalization & Sustainability

The air cargo sector has long been a leader when it comes to the trend of digitization, and this doesn’t show any sign of abating in 2023. Carriers and airports around the world have increasingly been looking into AI developments that can synergise with other technological evolutions in the sector. Such evolutions include realtime data availability and increased transparency in the shipping processes. What this ultimately offers is a change in working methods and operational strategy as the industry moves from a manual model to a 24/7 real-time, largely automated system.

This change is also being driven at a time when customers have gotten used to getting immediate access to data on their smartphones, meaning the air cargo sector will soon give the customers the ability to track and locate their shipments in real-time. Additionally, we are also likely to see an increase in the development of online portals for quoting, tracking, and shipment booking.

Another trend that will dominate this industry in 2023 is the increased focus on sustainability. In this context, the use of sustainable aviation fuel (SAF) will continue to play a major role. SAF could provide a massive opportunity for the air cargo industry to take a stride toward increased sustainability.

Sustainable aviation fuels can lower the net carbon emission by around 80% as compared to traditional jet fuel. Additionally, scientists are doing new research into SAF that will even be capable of absorbing more carbon dioxide than they release. Moreover, carriers, air freight forwarders, and airport authorities will continue to take environment-friendly steps by increasingly depending on solar power. The focus on digitization and sustainability will in turn benefit the entire value chain including, shipping companies, freight forwarders, investors, exporters, and consumers.

In this regard, DHL Express has recently announced the launch of a new service that will allow customers in Hong Kong to reduce associated with shipments through the use of SAF. It’s ‘GoGreen Plus’ service is available through the MyDHL+ online portal and is made possible through the express firm’s SAF partnership with bp and Neste.

The service was launched elsewhere earlier this year and is already available to customers in the UAE, the UK, Italy, Denmark, Sweden, Canada, Australia, New Zealand, and South Africa. It will be rolled out globally over the rest of 2023.

Ng Chee Choong, senior vice president and managing director of DHL Express Hong Kong and Macau, said: “In line with our global mission of ‘Connecting People, Improving Lives’, we continue demonstrating our commitment to Hong Kong by helping the city reduce its carbon emissions through investments in green fleet and facilities.

“We look forward to further redefining logistics while setting our sights on our net-zero-emissions target via the industry’s most comprehensive portfolio of green logistics solutions.” The new service is part of the company’s ambition to use 30% percent SAF for all air transport by 2030.