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Vol. 17 No. 36	Tuesday June 19, 2018

   The U.S. Department of Homeland Security (DHS) Air Cargo Advanced Screening (ACAS) program went into effect on Tuesday, June 12.
   Basically airlines are ordered to provide longer advance notice about cargo that officials believe may pose a security risk.
   Now carriers must send certain information about their cargo consignments to U.S. Customs and Border Protection before loading the plane.
   Customs applauded the new rule saying it now will be able to order airline crews not to load suspicious cargo.
   The government is not detailing the information that the airlines must provide.

   It should be noted, however, that before the mandatory rules took effect, many airlines voluntarily had already taken the steps required by the new rule.
   The requirements for U.S.-bound cargo are similar to standards imposed earlier this year on passenger planes operated by several Middle Eastern airlines.
   Vaughn Jennings, (right) a spokesman for the aviation trade group Airlines for America told Associated Press that his group is reviewing details of the rule, but has long favored mandatory measures for advance screening of cargo.
   Jennings said that because the security measures take place before planes are loaded, they cause minimal disruption to cargo shipments.
   The Customs agency said advance screening of cargo has helped it identify “a substantial amount of high-risk cargo” including shipments with potential ties to terrorists.
   The drive for new rules dates back to 2010, when terrorists concealed bombs in printer cartridges mailed from Yemen in a plot designed to bring down the planes over the United States.
   After a tip from Saudi Arabian security officials, the devices were found while the planes were stopped in England and the United Arab Emirates.
Geoffrey

     So far, the much-anticipated surge in rates on healthy global economic growth and tight capacity has not materialized on the major East-West lanes.
     Freightos put it mostly bluntly in declaring: “No News Is The News For Air Freight Rates.”
     The digital marketplace reported in early June that average air freight rates “haven’t moved since late March,” rating them in the range of $2.90-$5.00 per kg on the China-U.S. lane, $2.80-$4.50 on China-Europe, and $1.80-$2.70 for Europe-U.S.
     Flexport reported a similar picture earlier this month with no space constraints evident and rates stable ex-China, ex-Hong Kong, ex-Vietnam, and ex-Europe.
     Ex-U.S., Frieghtos said rates remained high for Latin America, where industrial action and a lack of fuel in Brazil saw flights cancelled in late May, but were stable elsewhere.
     “Space has opened up slightly for exports to Europe and Asia due to the additional seasonal summer flights,” it added. “Space is tighter on certain lanes to the Middle East and India, and space is very tight to Latin America.”
     However, while in the last few months markets have been stable, TAC Index’s specific lane pricing analysis reveals in more detail how rates have risen since last year.
     For example, on June 12, 2017, rates on the Hong Kong-North America lane were $3.24 per kg, but by June 11 this year they were up to $3.77 per kg, having peaked in between at $5.57 during December. Hong Kong-Europe rates over the same period showed a similar pattern (albeit prices were significantly cheaper than on the Transpacific), rising from $2.26 per kg on June 12, 2017, to $2.71 per kg on June 11, 2018, having reached the (relatively) giddy heights of $3.29 in the December peak season.
     Volumes, like rates, are also growing year-on-year. WorldACD’s latest analysis removed distortions related to factory shutdowns during Chinese New Year by shining a light on the first quarter. It found that over the first three months of 2018, volumes were up 4.8 percent year-on-year globally and rose a further 4 percent in April, illustrating what it called “serious business growth in air cargo.”
     WorldACD said that so far in 2018, some key trends had emerged.
     For example, pharmaceutical products and high-tech shipments are up 17 percent and 11 percent respectively, year-on-year.
     The analyst also noted that volume growth in the first quarter was highly variable by region and trade lane. So far in 2018, the Asia Pacific, the largest origin area, has been growing at only 3.7 percent year-on-year, with volumes up 4.8 percent to Europe but only 2.1 percent to North America.      But from Europe, the second largest origin area, growth is mainly to North America, up 4.6 percent year-on-year, rather than to the Asia Pacific, up 1.4 percent.
     While from North America, the third largest origin area, exports are up by 8 percent year-on-year thanks to strong demand from both Asia and Europe.
     “With the exception of growing transatlantic business from Europe, could it be that all these trends are nicely in line with economic theory?” said the analyst.
     “After all, the USD has been relatively cheap in this period and the Euro relatively expensive. One would thus expect North America to export more, and Europe to import more.
     “With the surge of the USD since early May, we may well be able to already ‘test’ this position in one month’s time, when the May results will be in.”
     Looking ahead, IATA argued that relatively becalmed markets were mostly down to the time of restocking cycles and consistent with demand drivers moving away from the highly supportive levels seen last year; for example, the Purchasing Managers’ Index for manufacturing and export orders fell in April 2018 to its lowest level since 2016.
     IATA's Director General and CEO Alexandre de Juniac said he expects markets to pick up later in the year, but warned there were also risks to growth, not least, he implied, from U.S. trade policy under President Donald Trump.
     “We remain cautiously optimistic that demand will grow in the region of 4 percent this year,” he said. “But the forecast appears to have increasing downside potential.
     “Oil prices continue to rise as does protectionist rhetoric. Borders open to people and to trade drive economic growth and social prosperity.
     “We are all disadvantaged when they are closed.”
SkyKing

     In March, FlyingTypers highlighted Babar Badat’s agenda upon taking the helm of FIATA. He said that FIATA “has a growing role to play in the fast changing international transport environment.
     “In recent years, FIATA has championed the need for better global connectivity.
     “I intend to continue this momentum,” President Babar Badat said in his exclusive interview for FlyingTypers.
     Babar is a fine gentleman from Pakistan. His ancestral ties with India go back to pre-partition, when his family had businesses there as well.
     Having taken his multifarious skills to lead a world class logistics enterprise today, it is only appropriate that he is the leader who will now take FIATA members to India, where they are promised to get a glimpse of what the future of logistics might look like.

Tech Savvy Entrepreneur

As an experienced entrepreneur, Babar Badat was ready to recognize the importance of investments in technology and infrastructure even before taking the helm of FIATA when he launched the “Connectivity Campaign” as the Chairman of FIATA’s Advisory Body International Affairs.

Why Posh?

     One of the accredited etymologies of the word posh, which today means elegant and rich, puts us back on P&O’s ships sailing to India from the UK.
     In the early part of last century, the “Port Out Starboard Home” (POSH) tickets allowed for a return journey sheltered from the scorching sunrays on the ocean, a luxury that those who could afford them preferred.
     Even the other etymology, which gives the word posh Romani origin, takes us back to the Indian subcontinent, where journeys of the Romani people started centuries ago.

Out From India

     India breathes the air of eternity. It is the country that produced some of the greatest love stories of all ages and one of its most significant monuments, the Taj Mahal, is the living signature of one such story. It’s a story of magnificence, where love and passion can create a truly irresistible recipe for today’s visitors, the FIATA members, and their families.
     The Indian subcontinent is a land with the power to evoke color, mystery, sensuality, and strong feelings just by thinking of it.
     The jungle, the cobras, the tigers, the elephants—who could resist these dreams and fantasies when we were children?

Delhi Dreams & The Future

     That is just what is going to happen. Babar is taking his FIATA members to Delhi to live these dreams, bringing them to touch the reality of future logistics while it is in the making.
     Believe me, watch the presentations and the movies that are available on FIATA’s as well as the Congress’ websites and let your mind spin with sheer power and electricity.
     You will want to buy your ticket right away!
     It will be POSH, but surprisingly not so expensive . . .

Planned Ahead

     FIATA decided to set its own sails towards India some three years ago—when the FIATA guiding star was clearly pointing to Asia—by electing its first Chinese President, Zhao Huxiang in Taipei, and Babar Badat was getting ready to succeed him in Kuala Lumpur.
     When all is abuzz like it will be in the days of the Congress in Delhi, you will surely be on the fast lane, but when the lights go down toward dusk, there will also be a certain longing toward more tranquil and serene atmospheres. This is precisely what the other side of India will bring: a more meditative and harmonious series of cultural events that will flow like the waters eternally streaming down from the Himalayas, giving the peoples of India life and solace before vanishing into the ocean.
     Plenty of business then, but not only that. Culture will also show the many facets of the Indian tradition and lifestyle.

Take A Deep Breath

Having seen this already on my own, my advice is to give yourself the benefit of a few days before or after the Congress, so that you can let yourself sink into the exquisite pleasures of serendipity.

Growing The Business

     Babar Badat’s Pakistan as well as India have been growing at tremendous speed in the last few years.
     India is rapidly taking a new role in the world in proportion to its population. “Make in India” has been as meaningful a watchword as the one-time “made in Japan” one used to be, for those of us who witnessed its explosive expansion some fifty or more years ago.
     Earlier in the year, Badat took the FIATA Presidency members in Lahore for their Presidency meeting; now he’s taking the FIATA members to Delhi for the Congress, a befitting opportunity for some, as historically Delhi and Lahore are sister cities and give a glimpse of the larger subcontinent.
     All these ideas suggest that Babar Badat will open an impressive congress in Delhi, together with his Indian friends of the Organising Committee, led by Debashis Dutta and FFFAI, Ashish Pednekar’s organisation, which successfully competed to bring this premier international event to the country.

Founding Father

     Mr. Badat is the Founding Chairman of Pakistan International Freight Forwarders Association (PIFFA), which is one of the main contributors to forming FIATA’s individual members’ vast constituency. PIFFA promotes the freight/logistics service industry as a whole and has also been instrumental in establishing and continuously updating the industry’s S.T.C (Standard Trading Conditions).
     Although Babar Badat has a principal role in FIATA, this is far from being his only task. He is also very active in other areas of trade for his country and the trading community at large.
     Babar has significantly contributed to launching the TIR convention in Pakistan and is the Founding Chair of the TIR Commission there. He sits on various Boards and is an important adviser to his government in areas pertaining to logistics, transportation, and trade and has lent his skills to enhance the role of his country in the region as well as in Geneva, where he regularly attends meetings of the United Nations and other multilateral organisations.

Perspective & Humor

     In March, Babar declared: “You must always maintain your sense of purpose and mission to build on the great potential of our industry. On the way, it does not hurt to maintain your sense of humor.”
     This is precisely how President Badat managed to take the helm of a complex global organization such as FIATA and bring it to new heights while maintaining his own business firm on the saddle.
     While he is riding into the future of logistics in India, he keeps his feet planted on the ground in Pakistan, so that everyone on both sides of the sacred rivers of this magnificent subcontinent can look at the future with a smile on their face.
Marco Sorgetti

For more on FIATA World Congress, click here

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