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Aug 26,2021

Delays of seven days for Shanghai cargo while ‘super peak’ approaches

Air cargo from Shanghai Pudong Air Freight Services International Airport (PVG) will face a delay of up to 7 days. This situation is expected to ease in early September. In recent days, ground handling and apron operations have been subject to a series of Covid cases. The strike caused airlines to cancel services and transfer flights to other airports.


In the webinar, Camille Carenton, Senior Air Trade Channel Manager at Flexport, said that PVG's capacity has dropped by about 33%. As a result, cargo to North America has a backlog of 5 to 7 days, while cargo to Europe has a backlog of 1 to 3 sky.


Carrenton added that the carrier is embargoing trans-Pacific westbound cargo in an attempt to solve the congestion problem at the terminal. Supply chain risk analyst Everstream Analytics said that the epidemic occurred in the ground handling agent Shanghai International Airport Service (SIAS). Hundreds of employees have implemented the sanitation agreement".


Some freight forwarders reported that the operation of the processing procedure PACTL was also affected, although it is not clear whether this is a chain reaction of the interruption of the SIAS operation or because the processing procedure is still facing worker isolation. "As of August 21, the health authorities were at the airport. At least five cases have been detected among cargo workers in China, prompting airport authorities to suspend tarmac operations, leading many airlines to suspend freighter flights and cargo-only passenger flights until further notice,” Everstream said.


Air Freight Services


"PVG is still open to passenger flights with limited labor; however, the increasing backlog of air transportation and increasingly limited air transportation capacity have prompted many freight forwarders to stop accepting bookings to PVG and warn of delays in exporting goods."


It added: "It is expected that the cargo business will continue to be interrupted in the coming weeks, because it is still unknown when PVG's flight schedule will return to normal. The continued limited air cargo capacity may further increase the spot freight rate, which has increased by more than 6% from the previous month. ."


Risk analysts said that of the 22 airlines that PVG relies on SIAS services, 17 operate in the PACTL terminal and 5 operate in the ETL terminal.


Some of these airlines are transferring cargo to Guangzhou International Airport (CAN), Zhengzhou International Airport (CGO) and Shenzhen Bao'an International Airport (SZX).


In the update of the sister headline DVZ of Air Cargo News, Oliver Link reported that Lufthansa Cargo, Qatar Airways Cargo, AirBridgeCargo, Etihad Cargo, and American Airlines Cargo have cancelled flights from the airport in recent days.


Air Freight Services


The report added that Cargolux continues to fly to the airport with reduced timetables. Korean Air said it will not be affected.


Although many freighter flights have been cancelled at the airport in recent days, FlightRadar 24 shows that freighter flights from Japan Cargo Airlines, All Nippon Airways, Kalita Airways, FedEx and SF Express have already taken off.


At the same time, Freightos data shows that since the outbreak, air freight rates from Shanghai to US destinations have risen by 15-25%, and freight rates to European airports have risen by 12-15%.


Super peak traffic


Neel Jones Shah, head of global air transport at Flexport, said that ramp capacity and Shanghai's capacity have dropped by about 80-90%. He added that although PVG problems should pass, they will contribute to what he calls "super peaks."


"We expect the congestion to continue until the week of August 30, and hope that we can return to'normal' in early September," he said. "It is important to remember that the situation is changeable; we are working with our aviation Company partners work closely to update the schedule.



“In order to maintain cargo transportation, Flexport has been transporting a large number of customer cargoes from PVG to Hong Kong (HKG) to meet the additional segments of our dedicated charter flights successfully transferred to HKG. “Other regional airports near PVG in Mainland China are also affected by ground handling operations. The reduced impact, the ability to accept new cargo aircraft business is limited.


"The important thing to remember here is that although this short-term congestion will pass, it is part of a larger congestion cycle and it will exacerbate the'super peak' we are already in.


"With the advent of the holiday shopping season, in the most important period of the retail sales cycle, companies must be creative and flexibly move the ways and locations of goods to put goods on shelves and complete orders."


The problems with PVG come as cargo operations at other airports and seaports in China have been affected by the blockade in recent weeks.