The International Air Transport Association (IATA) released data for global air cargo markets showing slower growth in November 2021. Supply chain disruptions and capacity constraints impacted demand, despite economic conditions remaining favorable for the sector.
As comparisons between 2021 and 2020 monthly results are distorted by the extraordinary impact of COVID-19, unless otherwise noted, all comparisons below are to November 2019 which followed a normal demand pattern.
Global demand, measured in cargo tonne-kilometres (CTKs*), was up 3.7% compared to November 2019 (4.2% for international operations). This was significantly lower than the 8.2% growth seen in October 2021 (2% for international operations) and in previous months.
Capacity was 7.6% below November 2019 (-7.9% for international operations). This was relatively unchanged from October. Capacity remains constrained with bottlenecks at key hubs.
Economic conditions continue to support air cargo growth, however supply chain disruptions are slowing growth.
“Air cargo growth was halved in November compared to October because of supply chain disruptions. All economic indicators pointed towards continued strong demand, but the pressures of labor shortages and constraints across the logistics system unexpectedly resulted in lost growth opportunities. Manufacturers, for example, were unable to get vital goods to where they were needed, including PPE. Governments must act quickly to relieve pressure on global supply chains before it permanently dents the shape of the economic recovery from COVID-19,” said Willie Walsh, IATA’s Director General.
To relieve supply chain disruptions in the air cargo industry, IATA is calling on governments to:
November Regional Performance
Asia-Pacific airlines saw their international air cargo volumes increase 5.2% in November 2021 compared to the same month in 2019. This was only slightly below the previous month’s 5.9% expansion. International capacity in the region eased slightly in November, down 9.5% compared to 2019.
North American carriers posted an 11.4% increase in international cargo volumes in November 2021 compared to November 2019. This was significantly below October’s performance (20.3%). Supply chain congestion at several key US cargo hubs has affected growth. International capacity was down 0.1% compared to November 2019.
European carriers saw a 0.3% increase in international cargo volumes in November 2021 compared to the same month in 2019, but this was a significant drop in performance compared to October 2021 (7.1%). European carriers have been affected by supply chain congestion and localized capacity constraints. International capacity was down 9.9% in November 2021 compared to pre-crisis levels and capacity on the key Europe-Asia route was down 7.3% during the same period.
Middle Eastern carriers experienced a 3.4% increase in international cargo volumes in November 2021, a significant drop in performance compared to the previous month (9.7%). This was due to a deterioration in traffic on several key routes such as Middle East-Asia, and Middle East-North America. International capacity was down 9.7% compared to November 2019, a small decrease compared to the previous month (8.4%).
Latin American carriers reported a decline of 13.6% in international cargo volumes in November compared to the 2019 period. This was the weakest performance of all regions and a significant deterioration from the previous month’s performance (-5.6%). Capacity in November was down 20.1% on pre-crisis levels.
African airlines’ saw international cargo volumes increase by 0.8% in November, a significant deterioration from the previous month (9.8%). International capacity was 5.2% lower than pre-crisis levels.
Danish container shipping giant Maersk has uveiled the design of its next-generation large container vessels powered by carbon-neutral methanol.
The company ordered a total of eight 16,000 TEU boxships from South Korean shipbuilder Hyundai Heavy Industries (HHI) in August this year.
The first green methanol-fueled unit is planned to be delivered to Maersk in 2024.
Once all eight vessels are deployed, they will be able to generate annual CO2 emissions savings of around 1 million tonnes, offering “truly carbon neutral” transportation at scale on the high seas.
The vessels will be 350 meters long, 53.5 meters wide.
To enable this new design, several challenges had to be addressed. Firstly, crew comfort had to be ensured with the accommodation placed in this more exposed location.
Moreover, adequate hull strength was also a key parameter to safeguard, with the accommodation block normally working as a hull “stiffener” when placed further backwards.
New arrangements for lifeboats and navigational lights had to be developed, plus new cameras to support the captain’s view when navigating.
A £200m railway tunnel dubbed a “UK engineering first” has been officially opened by the rail minister.
The Werrington Tunnel was created by “pushing” an 11,000-tonne concrete curve under the East Coast Main Line (ECML) near Peterborough.
The “dive-under” system is designed to take freight traffic off the passenger routes – and took a year to build.
The minister, Chris Heaton-Harris, called the tunnel “a major leap forward for the £1.2bn East Coast Upgrade”.
Work began on the project in the summer of 2018, and a curved concrete tube, weighing more than the Eiffel Tower, was pushed into place underneath the existing lines in January 2021.
Mr Heaton-Harris said: “This country’s railways have long been home to marvels of engineering and the new Werrington Tunnel shows that we are continuing that proud tradition.
“Opening this new section of railway marks the end of a project which saw Network Rail engineers deliver an incredible feat .. unlocking new opportunities for rail freight.”
The head of the board of directors of the Kiev I. Sikorsky International Airport Denis Kostrzhevsky announced the development of the cargo direction.
To do this, they plan to build high-quality infrastructure at the airport – freight and customs warehouses, as well as establish logistics chains.
“Now we are focused on the development of the cargo direction and see significant potential. And for this, it is necessary to build high-quality infrastructure at the airport – freight warehouses, customs warehouses, to establish logistics chains. This is one of our strategic goals,” he said.
Kostrzhevsky added that the market of passenger and freight traffic in Ukraine will develop at a faster pace, since the state has a colossal transit potential.
The head of the airport’s board of directors also said that at the moment there is another investment direction related to the expansion of the range of ground services and the construction of hangars.
“Hangar storage of aircraft is a relevant service, especially when it comes to small aircraft, which are expensive and, in fact, must be stored in the garage. Here is a Mercedes, which costs 100 thousand dollars, we put in the garage, and an aircraft for 20 million For some reason we keep dollars in the open air. And now this service is in great demand on the market, “he stressed.
“We do not stop and are constantly looking for new directions for development. This is the essence of the aviation business – increasing income and expanding the range of services provided,” summed up Kostrzhevsky.
The only direct cargo charter flight from Hong Kong to Kiev (Boryspil), starting from November 20, operates three times a week – on Tuesdays, Thursdays and Saturdays.
The Ukrainian logistics company UTEC logistics company carries goods from China to Ukraine by charter flights, but charters on a regular basis began to serve the route in September with a frequency of 2 times a week.
According to the company, such a service was previously unavailable for commercial cargo – only courier cargo was transported by air.
The flights are operated by a chartered Airbus A330 aircraft. The company clarifies that despite the fact that the actual point of departure is Hong Kong, goods are delivered to Ukraine from all parts of China.
“At the moment, cargo charters are the fastest delivery from China. It helps Ukrainian business and retail to work successfully, because they have the opportunity to quickly bring goods in high demand season and bypass difficulties with delays and cancellations of regular flights under quarantine restrictions”, – noted Roman Bazakin, CEO of UTEC logistics.
Delivery of cargo to Ukraine from the moment of departure from China takes 14 hours. At the same time, it is carried out without reloading at other airports, which excludes the possibility of delays or loss of cargo on the road.
Cargoes from 50 kg are accepted on board in boxes or on pallets. In general, one flight can bring up to 48 tons. Almost all types of cargo are transported (including electronics with batteries, Covid tests and oxygen concentrators). Food and animals are not accepted for carriage.
At the moment, the logistics company has a contract for the transportation of commercial goods along the route until the end of January 2022, if necessary, it can be extended.
Ukraine plans to invest UAH 33.9 billion in the development of the aviation industry by 2030, said Adviser to the Minister of Infrastructure Oleksandr Griban during the forum “Large Construction: Aviation and Tourism”, which took place on November 25, 2021 at Boryspil International Airport.
At the same time, he emphasized that the comprehensive state support for the development of the aviation industry involves the implementation of economic policy for 2022-2024 and a targeted scientific and technical program for the development of the aviation industry for 2021-2030.
“The total amount of financing of the state civil scientific and technical program for the development of the aviation industry until 2030 is almost UAH 33.9 billion. Including more than UAH 18 billion – from the state budget and almost UAH 15.9 billion from the own funds of enterprises and other sources. “, – said Griban.
The adviser to the Minister of Infrastructure explained that the measures envisaged are support for the cargo aircraft industry and the creation of a European hub for the modernization and repair of aircraft using the system of converting passenger aircraft into cargo aircraft.
He also noted that Ukraine is one of seven states that have a complete closed cycle of aviation production – about 40 enterprises of the aviation industry work in the country.
“Over the past 10 years, these enterprises have generated more than $ 12 billion in gross income. About $ 3 billion in taxes have been paid from them to the state budget,” he summed up.
The Ministry of Infrastructure of Ukraine and the Airbus concern signed today, November 25, a memorandum of intent for cooperation on the creation of a national air carrier of Ukraine.
As the CFTS correspondent reports, on the part of the MIU, the document was signed by the relevant minister Alexander Kubrakov, on the part of Airbus – the vice-president of Airbus in Central and Northern Europe and Central Asia Kimon Sotiropoulos.
According to Kubrakov, the airline will become profitable within 5 years. “The market will grow, it is recovering. I am sure that there will be enough room for everyone in our market. We will not try to compete as tough as possible with private airlines,” the Minister of Infrastructure commented on the signing of the memorandum.
“We already have confirmation of the economic feasibility of creating such an airline from our French consultants, and a corresponding business plan has already been developed,” he added.
“Starting to create a new carrier, you can immediately invest in new technologies,” said Kimon Sotiropoulos.
Recall that the new airline will be named Ukrainian National Airlines – UNA.
For the creation of a national air carrier in 2021, budget funding is provided at the level of UAH 0.5 billion. The need for 2022 is another UAH 2.5 billion.
Ukrainian National Airlines will begin flights in 2022 from two domestic and 14 international destinations.
“We will start domestic flights in 2022 with two destinations. Then, in 2023, we will open 8 destinations. By 2026, domestic flights will cover 8 destinations and 7,000 flights a year,” said Patrice Fazier, consultant at the French consulting company Aerogestion.
As for medium-haul destinations, namely the regional international network, the carrier will also begin flights from 2022. Flights to 14 directions will be carried out.
“In this segment, our plan for 2023-2026 is 37 destinations. In 2026, in general, the medium-haul network will be represented by more than 15 thousand flights a year,” Fazier said.
Serving long-haul international flights will begin in 2023 from one direction.
“By 2026, we will expand the long-haul flights network to 5. In this segment, by 2026, we intend to reach 2,100 flights per year,” added a consultant to the French consulting company Aerogestion.
According to him, the concept of the fleet is still under revision. However, he clarified that the UNA fleet must be certified by EASA, FAA and the Ukrainian aviation authorities.
Given the need for FAA certification, the planned long-haul destinations are likely to include North America.
One of the biggest logistics operators in Europe, Raben Group, has just signed a seven-year agreement with PGE Obrót for the purchase of green energy (Power Purchase Agreement). Pursuant to the agreement, Raben in Poland will use 100% zero-emission energy starting from 2023. Dedicated photovoltaic farms will be built to meet the needs of the logistics operator. The long-term agreement will be in force from 2023 until the end of 2029.
“I am very pleased that all of our facilities will be powered by 100% green energy from photovoltaic farms. This will reduce CO2 emissions and contribute to the implementation of our Sustainability Strategy.” – said Ewald Raben, CEO Raben Group, and stressed – “If we don’t take care of our planet now, our children will have a problem. That’s the reason why we want to be a trendsetter in the market in terms of sustainability, not only by having green trucks but through all the processes which we make as environmentally friendly as possible. Signing the agreement with PGE is another step to actively support the UN Sustainable Development Goals and an opportunity for green investments in Poland.”
This means that new locations generating green energy will appear on the map of Poland thanks to Raben Group. There will be several dedicated photovoltaic farms with the total area of about 40 ha and the total capacity of about 35 MWp, providing 35,000 MWh of electricity per year – it is the entire demand for electricity of all Raben facilities in Poland. Construction of the first farm will begin at the beginning of 2022.
It is also worth mentioning that Raben has also contracted renewable energy for the period from 2021 to 2022, which significantly reduces greenhouse gas emissions. However, the agreement with PGE signed this year contributes to the creation of new photovoltaic farms on the map of Poland.
The Group has been consistently implementing its Sustainability Strategy, one of the main goals of which is to reduce carbon dioxide emissions. The recently signed green power purchase agreement (PPA) will certainly contribute to this.
The company has also taken a number of other steps over the years to reduce its carbon footprint. We rely, among other things, on a modern fleet, energy-efficient warehouses and offices, and the optimal organization of transport, as well as tools taking advantage of modern technology and software (Smartour, CO2calculator).
The Ministry of Infrastructure of Ukraine, within the framework of the program for reloading the freight car fleet, Ukrzaliznytsia, plans to start leasing financing of this program from 2022. This was announced by Minister Alexander Kubrakov during the forum “Large construction: a new railway”.
“Starting next year, we are starting a large-scale program of reloading the freight car fleet. This is 46 thousand new gondola cars and grain carriers, the market is more than UAH 100 billion. We understand that this program will not work without an accessible and understandable leasing mechanism. We are planning this in the budget. 2022, “he said.
According to the infographics provided by the minister, within the framework of the program for the renewal of the freight car fleet in 2022-2028. planned to update:
According to Kubrakov, all those involved in the chain of production and renovation of cars are Ukrainian enterprises.
“Today, the level of localization in the production of freight cars reaches 95%, and all enterprises in this chain are Ukrainian – from the production of small components to metal,” the minister said.