Meantime In Japan—Flags that read “Cheer up, Wuhan” are displayed at shopping district in Osaka, Japan. At Daikoku Wharf in Yokohama, the docked cruise ship Princess Diamond revealed 130 people infected with novel coronavirus pneumonia (NCP). The number of the patients who have been infected with NCP has reached 40,171 with the death toll confirmed at 908 as of February 10th in China.

     Let’s face it.
     Everyone had hoped that 2020 would carry forward the signs of recovery that glimmered a bit in December. Now those hopes have been dimmed by the uncertainty of the Coronavirus pandemic, which has been described by some, including former U.S. Presidential Advisor Stephen K. Bannon as ‘China’s Chernobyl.’
     As the world braces for what’s next, the spreading epidemic just over the past weekend saw China receive U.S. airlifted 100 tons of medical supplies, while Kalitta B747 aircraft with crew in bio-hazard masks continued lifting American citizens out of China on cargo aircraft.
     Comparisons to the China SARS epidemic of 2003 might be made medically in terms of proper action, but seem meaningless on the world economic stage at least because in 2003 China GDP was $1.5 trillion dollars and today that number has reportedly reached 19 trillion (USA 17 trillion) making it the biggest economic machine in the world.
     That number may be in question, as a think group “The Conversation” points out, saying China’s GDP measured at market exchange rates, is only US$9 trillion – a bit more than half that of the USA.

Nowhere To Run Nowhere To Hide

     But the point is that what happens in China touches everybody, total GDP numbers up or down is no longer in doubt.
     No doubt the true numbers of people suffering in China right now are being suppressed by the government there.
     Once again Hong Kong is noted for its upfront dealing with a Mainland China-driven situation, having closed all access save a single highway.
     No one can doubt the courage and brilliance of the Chinese people.
     Doctor Li Wenliang, who first realized and warned people about the Wuhan virus, was thrown in jail as a whistle blower, and then once released from lockup went back to help others and died this past weekend. He should be considered for some kind of global humanitarian award.
     While things may get worse in China before they get better, and as the world watches and waits, we look for some information of how air cargo feels about things right now in the second week of the second month of the year 2020.
     Of special interest are travel plans of air cargo stakeholders during a year, when a random temperature check of people connecting and moving through any airport might be cause for a two-week incarceration at an airport or military location, or even the cabin of a luxury liner.
     FlyingTypers spoke to some leading people in our business, to try and catch the mood of the industry right now.

ATC Continues With Few Interruptions

     Ingo Zimmer CEO of ATC told Flying Typers:
     “Due to the decreased capacity from cancelled passenger flight schedules we are planning extra freighter charter flights to accommodate the demand when Chinese industry begins producing again starting mid-February.
     “Of course some travel plans have been curtailed, including meetings I planned for China early February that were cancelled.
     My travel plans however are unchanged: Air Cargo India in February, WCS in Istanbul, Intermodal Sao Paulo, ACF in Miami and Air Cargo China in June are still on the ATC trade show list,” Ingo Zimmer said.

View From Dubai

     Lionel Smith is a good barometer of all things Dubal Cargo.
     Lionel, an old hand in the logistics business across the region for the past two decades plus, is Managing Director of ACI, located in Dubai Logisitcs City.
     “Now with the Novel Coronavirus spreading as a Global Pandemic, with increasing deaths reported during the past weeks, and thousands infected all over China, and cases of infection reported in more than 31 countries, there is huge cause of concern for trade and transportation,” Lionel warned.

Widespread Impact

     “The Wuhan virus impact will be felt in manufacturing, which will affect the transportation sector.
     “The hospitality industry, aviation, airlines in particular with their pax numbers and revenues, are also taking a hit.
     “Retail, of course is also in the cross hairs of the pandemic.
     “The China Coronavirus will create unemployment and have huge financial impact during the next few quarters while the world searches for a cure,” Lionel Smith predicts.

UAE 2020 & Logistics

     “In the UAE, we are going ahead at this point with EXPO 2020 which will take place in Dubai from October 20, 2020 and run until the April 20, 2021.
     “This event should stimulate and ignite further growth domestically for the Logistics Community, Hospitality Sector, Retail, Transportation and all other business sectors here,” Lionel declared.
     “Expectations are high as the Expo Committees are gearing up to receive over 25 Million visitors at the event.”

New Markets

     On a very positive note, ACI has just registered a company in the USA with local partners.
     “Our offices will be based out of Virginia as we get underway,” Lionel concluded.

The View From Hartsfield Jackson International Airport

     “We are now conducting studies to determine what our recovery time might be, using the SARS outbreak as our marker,” said Elliott Paige, Director-Air Service Development, Hartsfield-Jackson Atlanta International Airport (HJIA) Atlanta.
     “We have spoken to some airlines that are doing similar studies and are also talking to stakeholders in the trade and cargo community to determine best course of action.
     “Much depends on how fast the WHO and CDC can find solutions with the Chinese and global governments such that they can resolve this soon.
     “Meanwhile at HJIA we continue to build state-of-the-art facilities, and add new technologies to ensure we can support a fast rise in trade growth after the event.
     “I think we act like we should in any downturn: minimize loss during the downturn, and prepare to capture as much success as we can from the coming economic boom.”

Supplies, such as masks, are prepared to send to China at Japan Youth Development Association in Tokyo on February 11, 2020.       An old Chinese poem, that means ‘wind and moon are under the same sky however living in different place,’ is written on the box.      In the cargo area at Norman Y. Mineta San Jose International Airport in San Jose, California, scores of people, including people from Gracious Life Foundation (GLF) checked and sealed cardboard boxes containing medical supplies, protective gloves and clothing, face masks, hand sanitizers and other items for air shipment to China to aid in stemming the coronavirus outbreak.

Help For China?

     “Once we start opening air space, we suspect that there may be greater procedures regarding human health that would be required to protect aircrafts and cargo. WTO, WCO and IATA should devise a task force with major governments to develop efficient human health procedures that will allow trade to continue even minimally, despite these outbreaks.
     “The problem is that totally closing a country with an outbreak, can be counterproductive as suggested by the WHO, because they may need help from other countries to bring in supplies, medication and other important necessities to help the population, not to mention people will still move albeit now without surveillance.
     “Closed borders mean this country may be left to deal with a pandemic on its own.
     “However, opening air space has to be done in a safe way to prevent further spreading, and health procedures, use of crowd surveillance technology, for cargo will be needed at the airports.

Altered Plans for 2020

     “My team and I have altered our travel plans, unfortunately. “These are, understandably, safety requirements from our own health authorities both for us and our colleagues.
     “I have cancelled trade shows I had planned for China in 2020.
     “I hope to reconnect full force in 2021, because China is still our second largest trading partner, and trade between our two countries will not evaporate,” Elliott Paige told FlyingTypers.
Geoffrey

      In December of 2019 global air cargo business dipped by 1.7% YoY, but that was not the worst, in fact that 1.7 number in a year where the walls kept tumbling down was the smallest decrease since January 2019.
      Revenues as compared to 2018 a boom year, were down 11.7%
      Last year can be recalled as a time that delivered less than spectacular numbers with tariffs and trade wars and upheaval in Hong Kong, that turned the most powerful air cargo gateway in the world into silly putty .
      So overall, world air cargo chargeable weight dipped by 4.4% in 2019, Air Cargo Data (ACD) reported Thursday January 30.
      By the numbers December cargo load factors dropped by 2.2% YoY, and by 2.7 MoM while high-tech & other Vulnerable Goods increased by +13.3% YoY.
      Pharma & Temperature Controlled Goods rose by +12.6% YoY ACD said whilst perishables & flowers were up (+3.5% YoY), but fruits & vegetables suffered (-7.9%).

The Year 2019

      “Results for the full year 2019 were not impressive: worldwide revenue, measured in USD, fell by 11.7% compared to the top year 2018, whilst it did not grow compared to 2017 either, ”ACD declared.
      “The main reason was a YoY yield drop of 7.6%, as total weight fell by 4.4%.
      “Although pharmaceuticals and vulnerable goods (including High-Tech) both showed growth of around 8.5% in volume, their yield drops – though not as steep as in general cargo - were a cause for concern for the airlines.”

Europe Especially Germany Tanked In 2019

      Europe took the hardest hit in 2019: it lost more than 16% of its revenues (in USD) of the previous year, equal to -12% in EUR, with Germany accounting for half of Europe’s woes.
      However Africa and Latin America fared better than the larger regions in the Northern hemisphere, ACD said.
      Meantime in Asia Pacific and Europe outbound was slightly better than inbound, the opposite was the case for North America.

The Hong Kong Factor

      “Many have attributed (part of) the disappointing 2019-results for air cargo to the worsening USA - China relationship, but trying to establish where the consequences of the trade war were felt most, is not all that easy,”ACD noted.
      “While China inbound dropped by 6%, China outbound increased by 2.7%.
      In total air exports increased by 2.8% to Europe, and dropped by only 0.3% to the USA.
      “That certainly looks a whole lot better than the worldwide drop of 4.4% YoY.
      But it is not the whole story, as one of China’s and the world’s great gateways, Hong Kong saw air exports down -5.5%
      The decrease in Hong Kong to Europe and the USA was the worst (-10.8% and -14.4% respectively).
      Hong Kong USA numbers were down - 5.3% YoY, and lost less than that in its air cargo business to China (-4.9%), but more to Europe (-5.7%). And inbound USA stood at -4% YoY.

IATA Tiptoes Through Darkness Lightly

       Alexandre de Juniac, IATA’s director general and chief executive put 2019 in blunt terms in that group’s yearly numbers recap last week declaring:
      “Trade tensions are at the root of the worst year for air cargo since the end of the global financial crisis in 2009.
      “While these are easing, there is little relief in that good news as we are in unknown territory with respect to the eventual impact of the coronavirus on the global economy.
      “With all the restrictions being put in place, it will certainly be a drag on economic growth.
      “And, for sure, 2020 will be another challenging year for the air cargo business,” he said.
Geoffrey