Air cargo industry pounded by ash
The global air cargo industry is in a costly holding pattern as it waits for ash spewed from a remote volcano in Iceland to subside.
The ash has virtually shut down air traffic in most of Europe since Thursday at noon European standard time. For the air freight industry, that shutdown has significantly affected key cargo hubs in northern Europe.
The knock-on effect of the closures, however, has spread to North America and Asia, as flights destined for Europe have been grounded, leading to the most severe disruption to air transport since the 9/11 terrorist attacks in 2001. Analysts are predicting that this disruption will likely be even more severe, given that there's no timetable for when the volcano might stop erupting.
Airlines and national air traffic control associations are waiting for one of two developments: the volcano to stop spewing ash, or for wind patterns to stop carrying that ash in a southeasterly pattern, directly over Europe.
There seems to be no respite on the horizon as of Monday morning, with U.K. air traffic controllers closing airspace until 1 a.m. Tuesday local time, at the earliest. Most volcano and meteorological experts expect the closures to persist throughout the week, at least.
In the meantime, a handful of air carriers have begun testing whether they can fly below, above, or even through the ash cloud, which is moving in a band in which commercial airliners most efficiently fly. These test runs, conducted without passengers, have yielded encouraging results.
KLM and Lufthansa reported no damage to planes that flew test runs.
“We have found nothing unusual, neither during the flight, nor during the first inspection on the ground,” KLM Chief Executive Peter Hartman told BBC. The airline's test was conducted eight miles up in Dutch airspace.
Lufthansa said it flew 10 planes from Frankfurt to Munich at heights of up to five miles, while Air France said it had successfully carried out a test flight from Paris to Toulouse at an unspecified altitude, BBC also reported.
Airlines are understandably keen to get their planes flying again, given they are losing roughly $160 million per day between passenger and cargo operations.
Yet the power to fly again will rest solely with the air traffic controllers from individual nations in Europe, or possibly by an EU directive. And they seem reticent to allow flights if any danger from ash still exists.
A range of air cargo officials told Air Cargo News over the weekend that the ash problem is yet another major hurdle for the struggling industry to overcome.
Dave Brooks, president of American Airlines Cargo told the magazine: “What’s next, locusts?'
Tony Randgaard, spokesperson for Continental Airlines Cargo, said: 'Volcanic ash is indeed Kryptonite for air cargo.'
A FedEx spokesperson, meanwhile, said over the weekend the company has canceled, diverted or delayed 100 flights into Europe and is trucking packages across the continent from airports that are open. On Friday, FedEx said it wouldn't be accepting international freight shipments bound for Europe using any of its products: International Express Freight, International Economy Freight, Airport to Airport and International Premium.
The company, in a statement, said it's only the second time an entire region has been shut down, the other being 9/11.
Hong Kong carrier Cathay Pacific has seen major disruptions as well.
As of Monday 'we have canceled 17 of our European freighter services due to the continuing impact of volcanic ash on European airports,' Cathay Pacific told American Shipper.
Cargo officials have warned European cities they may begin to see a shortage of certain vegetables and cut flowers in markets over the next week if flights continue to be canceled.
'The flight disruptions grounded about half of the daily cargo volume between Asia and Europe,” the Wall Street Journal reported Saturday. “About 7,000 tons of goods are flown daily on average from Asia to Europe and an additional 4,000 tons from Europe to Asia, the analyst estimated, involving mostly electronics, luxury items and perishable goods such as fruits, vegetables and meat — raising concerns about possible shortages of some products if disruptions continued.”
Individual airlines and forwarders are generally giving updates on how the situation is progressing on their Web sites.
'Right now we have just one MD11 freighter on the ground here in Frankfurt with the rest of the fleet standing by at airports all over the world,' Lufthansa Cargo spokesman Nils Haupt told Air Cargo News.
In a statement over the weekend, the German carrier said it would accept only the smallest pieces of air cargo for the time being.
'Opening the airspace for only a few hours, without prior set-up time, does not enable regular flight operations due to logistical reasons,' Lufthansa Cargo said. 'Please be aware that due to the extraordinary circumstances Lufthansa Cargo is in Frankfurt only able to accept booked and confirmed shipments with dimensions of less than 100 centimeters by 100 centimeters by 100 centimeters.'
Swiss forwarder Panalpina said the cancellation of flights has made worse an already tight capacity situation between Europe and Asia.
'All flights to and from Europe are affected on all routes and many are already canceled,' Panalpina said in a customer update Friday. 'Specifically on the trade Far East westbound, this situation further deteriorates the current tight capacity and leads to additional bottlenecks. For example, some carriers in China have already stopped accepting cargo due to unavailable warehouse space at the airports, and grounded most flights.'
Panalpina said the backlog will inevitably force it to raise rates once service to Europe is restored.
'As an unfortunate consequence, backlog continues to build up at many origins. As soon as flight operations are back to normal, additional capacity at higher cost will be required to clear backlog. Consequently airlines are implementing a rate increase with immediate effect and until further notice. Although Panalpina is working on optimizing procurement in the customers’ interest, the present situation leaves no alternative but to pass on this rate increase as of today.'
Fellow Swiss forwarding giant Kuehne + Nagel had a similar message: 'This 'force majeure' event could have the potential to disrupt the global air traffic network to a great extent. The likely consequence could be a further increase in freight costs, in a market already short on capacity. With discontinued air cargo uplift, warehouses in Europe and overseas will run full resulting in cargo embargoes until the air traffic restarts.' ' Eric Johnson