The first part of February is traditionally one of air cargo’s busiest seasons regarding the shipment of fresh cut flowers, thanks to the Valentine’s Day holiday.
      From field to store, these precious goods will eventually make it to the hands of many loved ones across the world.
      In 2016 alone, American’s Cargo division packaged and shipped more than 19 million pounds of flowers worldwide—a fact they’re quite proud of.
      Most of these flower shipments are grown in places like the Netherlands, the U.S., Ecuador, and Colombia. In fact, flowers are a top export from Latin America.
      Once picked, flowers are packaged and sent to American Cargo, then loaded onto the aircraft with one mission in mind: to warm hearts and brighten spirits.
      As the largest cargo hub in American’s network, Miami (MIA) plays a key role in the movement of flowers and other perishables. 
      MIA is both a destination and transiting hub for key flower producing locales like Quito, Ecuador (UIO), and Bogota, Colombia (BOG).
      So, for American’s MIA team, this means a busy February, shipping a plethora of fresh buds—mainly roses—through their hub.
      “We have local customers in MIA that distribute all types of flowers domestically, including Hawaii.
      “We also have flower importers from Latin America that contribute to our worldwide export volumes out of MIA,” said Marah Schobert, Regional Manager, Cargo Sales – MIA.
      In fact, flowers are a top export from Latin America.
      Once picked, flowers are packaged and sent to Cargo, then loaded onto their aircraft for shipment across the globe, especially to European destinations like London, Amsterdam, Madrid, and Paris.
      The American Cargo MIA team offers all of their perishable customers temperature-controlled shipping options to help maintain the highest possible quality throughout transport. Specifically for the MIA team, February isn’t the only busy flower month. They also see an increased amount of flower and other perishable shipments in October and May, right before Mother’s Day.
      So why should folks trust American with their delicate perishables?
      The answer is quite simple, Schobert says.
      “We offer a reliable service with a network that supports flawless transportation around the world.”
      It’s clear that American’s Cargo team is everybody’s Valentine! They take pride in the flowers they ship, as they know many happy people will end up bringing them home to someone special this February 14—or any time of year.   
Geoffrey

Why FIATA Matters

     The end of year shipment surge saw volumes climb globally and, despite a pricing stumble over New Year, the outlook is positive for 2017.

Results Stunning

      “It was a stunning last quarter and December was a surprise for us all in terms of demand and pricing,” one leading air freight forwarder in Asia told FlyingTypers. “I think we’ll see seasonal fluctuations in Q1, but most of the PMIs and new export order figures are good for 2017 and that’s what customers are also telling us about their own businesses. Demand seems quite firm. So far, so good.”

February Shows The Love

      As the first days of February broke and Asia awoke from its post-Chinese New Year slumber, myriad indicators revealed the full extent of the turn-of-year demand surge.
      As previously reported in FlyingTypers, leading hubs including Changi and HKIA credited final quarter throughput gains for turning what had been a disappointing year into a record breaking one. A similar picture was also apparent at Incheon in Korea where, despite a reduction in overall imports and exports, international air cargo volumes increased 4.6 percent year-on-year to 2.71m tons on rising exports to North America and Europe in the latter months of 2016. And in China, Shanghai Pudong Air Cargo Terminal Ltd., the main air freight handler at Shanghai Pudong International Airport, also set a new record of 1.67m tons last year, a 4.5 percent year-on-year increase.

Year On Improvement

      Unsurprisingly then, most of Asia’s leading airlines posted heavy year-on-year carriage improvements in December and this was reflected in the latest report from the Association of Asia Pacific Airlines. AAPA said member airlines had seen a 1.8 percent year-on-year increase in international air cargo demand in December and had seen growth of 5.7 percent during the second half of 2017 after suffering a 2.2 percent year-on-year contraction during the first six months of the year.

IATA Solid Numbers

      IATA recorded a 3.8 percent year-on-year surge in global air freight demand in December. This was almost double the average growth of 2 percent recorded over the previous five years. All regions except Latin America saw positive growth and, surprisingly, carriers in Europe accounted for almost half the total increase in demand.
      WorldACD’s data showed an even better performance for the air cargo sector. December, according to the analyst, was “friendly” to air cargo because Christmas on a Sunday meant more business days in the last month of the year than in 2015. “And yet, it would have been difficult to predict the exceptional year-over-year (YoY) performance we saw in December: a 9.4 percent volume growth coupled with a growth in USD-revenues of 4.5 percent,” reported the analyst. “After November, December was only the second month in 2016 showing a YoY revenue increase.”

2016 Landed Au Contraire

      “Contrary to previous years, Europe and North America recorded strong December business, at a par with the top month October. In line with the demand for perishables, Africa and Latin America peaked in December. Asia Pacific stuck to its pattern of November being the best month of the year.”

Drewry Looks East & West

      It was therefore surprising when Drewry’s East-West Airfreight Price Index (a weighted average of all-in airfreight “buy rates” forwarders pay to airlines for standard deferred airport-to-airport airfreight services on 21 major East-West routes for cargoes above 1,000 kg) fell marginally in December to $3.14 per kg, which corresponded to an index rate of 96.8. This was down from $3.35 per kg in November, when the index reached a 12-month peak of 103.2.
      The December reading was the first rate fall since May. Drewry explained the decline by pointing out that December traditionally sees a drop off in rate. “Testament to the growing strength of the market, the rate decrease from November to December was the smallest of its kind since 2012,” said the analyst in its Sea & Air Shipper Insight report. “We expect to see a further seasonal decrease to the index in January, once again smaller than usual.”

Into The Black

      The end-of-year surge saw leading executives and analysts proclaim 2016 as one of the best of recent vintages for air freight, and good cause for optimism in 2017.
      “Since 2010, we have not seen a better quarterly YoY performance than in Q4 of 2016: chargeable weight increased by 7.5 percent YoY, whilst growth in DTKs (Direct Ton Kilometers) was 8.3 percent,” said WorldACD. “In other words, the average distance between origin and final destination of the shipments carried increased slightly.
      “In both 2014 and 2015, the average USD-yield in Q4 was about 1 percent higher than in Q3: in 2016, it was around 6 percent higher.”
After a tepid start to the year, IATA said a strong peak season had seen an increase in the shipment of silicon materials and a turnaround in new export orders. This contributed to the late uptick in demand last year, while the early timing of the Lunar New Year may have also helped push demand higher in December.
      “In terms of demand, 2016 was a good year for air cargo,” said Alexandre de Juniac, IATA’s Director General and CEO. “That was boosted by solid year-end performance. Looking ahead, strong export orders are good news. But there are headwinds. The most significant is stagnant world trade, which also faces the risk of protectionist measures. Governments must not forget that trade is a powerful tool for growth and prosperity.”

Must Stay Competitive

      And, De Juniac warned, further success in 2017 will be dependent on the air cargo industry improving its competitiveness. “We know that the way forward is defined by digital processes that will drive efficiency and improve customer satisfaction,” he added. “We must use the momentum of renewed demand growth to drive the important innovations of the e-cargo vision.”
SkyKing

Vol. 16 No. 15
FIATA Adding Record New Numbers
Chuckles for February 10, 2017
Nepal Disaster Only A Motion Away
Changed Lives - Nepal Disaster
Brave Bessie Blazes A Trail
Qatar Round Robin Adds Miami