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The weekly newspaper for air cargo professionals Volume: 20
Issue: 26
3 July 2017
ICAO: Lome Declaration vital for air cargo growth in Africa
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mplementation of the Lome Declaration is a crucial lever in growth of air cargo in Africa, said the International Civil Aviation Organization’s (ICAO) president, Olumuyiwa Benard Aliu last week. Speaking at the Second Meeting on Air Cargo Development in Addis Ababa, he explained the Declaration was vital for realising the technological innovation, regulatory reform and investment in infrastructure demanded. The key objective of the Declaration is the unobstructed flow and rapid release of goods through enhanced trade facilitation and custom clearance frameworks. Aliu also highlighted the significance of air cargo’s current and forecasted contributions to Africa’s economy. “The importance of air
cargo as a key enabler of international trade, especially with respect to high-value and time-sensitive goods, is reflected in the fact that air transport carries around 35 per cent of world trade by value,” he said. He added growth in African freight traffic outpaced the global average last year and freight capacity offered by African carriers surged over 20 per cent. Aliu noted progress of the Declaration should be achieved through ratification of the 1999 Convention for the Unification of Certain Rules for International Carriage by Air, which only 56 per cent of African states have adhered to. He said realisation of the ‘E-Trade for All’ initiative, which ICAO is undertaking in collaboration with other UN agencies, and deployment of the Cargo Service Quality Index for measuring freight performance at airports, a project ICAO and TIACA are developing are also key. Innovation he noted is crucial as e-commerce trends will continue to be a significant driver
IT system virus significantly disrupts TNT Express
TNT Express’ worldwide operations were “significantly” affected due to the IT system virus that is sweeping the globe. The ransomware attack on 27 June hit computers at Russia’s biggest oil company, Kiev International Airport, global shipping firm A.P. Moller-Maersk and the world’s biggest advertising agency WPP.
The FedEx subsidiary’s operations and communications systems were disrupted, but it said no data breach is known to have occurred. The operations of all other FedEx companies were unaffected and services were being provided under normal terms and conditions. FedEx said it cannot measure the financial impact of this service disruption at this time, but it could be material. A statement read: “Remediation steps and contingency plans are being implemented as quickly as possible. TNT Express domestic country and regional network services are largely operational, but slowed. “We are also experiencing delays in TNT Express inter-continental services at this time. We are offering a full range of FedEx Express services as alternatives.” The express freight firm said updates on service availability were to be provided periodically as systems are remediated.
of growth. “The air cargo share of items purchased online grew from 16 per cent to 74 per cent between 2010 and 2015, and is projected to reach 91 per cent by 2025. The number of parcels flown by air has grown from around 130 million in 2011 to around 400 million in 2015, at a staggering 30 per cent average annual growth rate,” Aliu explained. Progress on implementation of the Declaration also requires more investment in ground infrastructure, aircraft, and human resources in Africa, Aliu said. “The development and modernisation of reliable, quality aviation infrastructure is an important priority under the Lomé Action Plan,” added Aliu. “The rapid growth of both freight and passenger air traffic is now placing increased pressure on Africa’s airports and air navigation services, with latest projections telling us no fewer than 24 airports in Africa will have reached their maximum operational capacities by just 2020,” Aliu also explained. Among the main outcomes of the meeting was adoption of a new statement on the implementation of the Lomé Declaration, reaffirming commitment to the sustainable development of air cargo in Africa.
$150m terminal opened
Ethiopian Airlines inaugurated its new $150 million Cargo Terminal-11 during the Second ICAO Global Air Cargo Development Forum in Addis Ababa last week. The African carrier now has a tonnage capacity of one million tonnes - the largest in the continent and it adds to the existing Terminal 1. Covering 150,000 square metres the new terminal includes a dry cargo terminal warehouse, perishable cargo area with cool chain storage, full automation, an apron area to accommodate five additional freighter aircraft and more. After completion of the second phase, that will add 600,000 tonnes in capacity, it will be equivalent to cargo terminals in Amsterdam Schiphol, Singapore Changi, or Hong Kong. Ethiopian Cargo and Logistics Services operate eight freighters on 39 global routes with an average daily uplift of 650 tonnes on top of the belly capacity, 150 tonnes, to over 95 destinations globally.
LOBSTERS HELP HALIFAX GROW BY 21%
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E-COMMERCE DRIVING GROWTH AT HAMILTON TRUMP ARRIVAL SET TO HAVE AN IMPACT NEW INITIATIVES AND STRATEGY FOR TIACA
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Airfreight volumes up 6% at hubs in April
GLOBAL airfreight volumes increased six per cent in April despite uncertainty on global trade, the Airports Council International (ACI) reports. ACI says business confidence remains strong despite global trade uncertainty and economic integration in the US and the UK. International trade made gains on the cyclical recovery in the global economy, translating into robust growth in airfreight volumes, and the ongoing strength of export orders across manufacturing sectors for high value goods resulted in high growth. ACI says: “After a period of more subdued growth in 2016, airfreight volumes continued to increase in 2017. Overall volumes increased 6 per cent for the month and 7.7 per cent on a year-to-date basis.” Major freight hubs handling significant quantities of exports saw large volume increases, with Shanghai Pudong International Airport up 14.1 per cent, Incheon International Airport up 11 per cent and Hong Kong International Airport by 8.9 per cent. Asia-Pacific saw growth in April of 8.8 per cent, followed by Africa at 7.7 per cent, Europe with at 5.7 per cent, the Middle East at 4.6 per cent, North America at 3.7 per cent and Latin America-Caribbean 2.2 per cent.
aircargoweek.com
NEWSWEEK
DHL opens life sciences facility at Dublin Airport
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HL Supply Chain has opened a new state-of-the-art life sciences facility at Dublin Airport - extending its global end-to-end pharmaceutical supply chain capability. The facility covers 3,700 square metres of warehousing space, and will provide a logistics solution for pharma companies based in Ireland. Located at Horizon Logistics Park by Dublin Airport, the site is approved by the Health Products Regulatory Authority (HPRA). The facility will allow pharma companies manufacturing in Ireland to enjoy fully compliant temperature controlled end-to-end supply chain management including: storage, pick & pack and inventory control. Plans are in place to extend the service across the temperature regimes and provide value-added repack and postponement services. The new DHL logistics centre is expected to create up to 50 jobs over the coming months. The warehouse is segregated into different temperature regimes, the site offers a range of storage environments including 15 – 25 degrees Celsius, 2-8 degrees Celsius and minus 20 degrees Celsius.
The new facility makes Ireland the 43rd country in which the integrator has established a Life Sciences Center of Excellence, offering full access and integration with DHL’s temperature controlled transport services by road, air, ocean and express. Located close to European markets and well serviced by road, air and sea. Nine out of ten of the top global pharma companies and nine out of the top ten biopharma firms are based in Ireland.
Antonov and RwandAir appoint GSAs
ANTONOV Airlines has picked Air Cargo Partners Worldwide (ACP) as its general sales agent (GSA) in Australia. ACP has five offices in the region: Melbourne, Sydney, Perth, Brisbane and Auckland, and the representation will be managed by sales and development manager Ken Lyons. Antonov Airlines UK commercial manager, Martin Griffiths says: “We recognise the strong project cargo nature of the Australian market, ranging from oil and gas to mining
and other industrial sectors, and appointed a GSA to bring our expertise right to the doorstep of these key industries.” He says ACP was chosen for its experience in the heavy lift industry and dealing with Antonov AN-124s. Meanwhile, RwandAir (pictured) has named Network Airline Services as its GSA for the UK. The airline flies an Airbus A330 between Kigali and London’s Gatwick Airport three times a week, and has 22 connections to Africa. In 2016, RwandAir added two A330s to its fleet and a third Boeing 737-800NG, with a fourth due this year. The airline plans services to Guangzhou in China, Bamako in Mali, Conakry in Guinea, Lilongwe in Malawi and New York in the US.
CCA appoints Evangelakakis as chairman STAVROS Evangelakakis (pictured) has taken over as chairman of the Cool Chain Association (CCA), succeeding Sebastiaan Scholte, who is standing down after five years. Evangelakakis, who is global product manager at Cargolux Airlines International, has been a board member of the CCA since 2012, says it is a “great pleasure” and the CCA needs to continue listen to members concerns and act as a unified voice for the industry. He says: “It would be great if we could look towards holding more conferences on the
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cool chain, including airport communities in our efforts going forward. “We would like to continue to grow our membership base with people who are willing to make a change within the cool air cargo supply chain. Our goal is to have more transparency and ultimately more collaboration.” Scholte, the chief executive officer of Jan de Rijk Logistics says: “We have a voice in the industry and make things work. We are not bound by political correctness, we push for things and we are not afraid to discuss relevant topics in an open & transparent way. Dusseldorf Airport Cargo managing director, Gerton Hulsman and Bcube Air Cargo head of pharma business development, Fabrizio Iacobacci have also joined the CCA board.
Venema new chairman of Cargo iQ
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argo iQ has named DHL Global Forwarding senior vice president and global head of network carrier management, Henk Venema (pictured) as its new chairman. Venema, who has over 15 years of experience in air cargo, takes over from Max Sauberschwarz, vice president and global head of carrier and gateway air logistics at Kuehne + Nagel, who chaired the IATA-interest group from 2013. Air France KLM Cargo director of operational integrity, compliance & safety, Kester Meijer, will continue to support the group as its vice chairman. Sauberschwarz will continue on the board. Cargo iQ executive director, Ariaen Zimmerman says: “It is an enormous accomplishment that Cargo iQ can count so many great industry leaders amongst its board members. “We owe a whole lot of gratitude to Max Sauberschwarz, who has done so much to get, and keep, us on the right track. “His leadership will be missed, but Max will remain on our board and I am confident that, in Henk Venema, we have found another great leader to help our Board and membership continue to improve the performance of the air cargo industry.” Venema takes over as Cargo iQ continues to roll out initiatives kick started under Sauberschwarz’s chairmanship. This included
12.6% rise in May at Changi
the rebranding at IATA’s World Cargo Symposium in Berlin, Germany, in 2016. “I am excited to be taking the role of chairman as the organisation continues to innovate and develop, thanks to initiatives such as the new Smart Data Portal,” says Venema. “Cargo iQ is a key initiative in the industry, where not only airlines, but also freight forwarders, handlers, and technology providers come together to define the joint and unique quality standards we want to set for the industry going forward. “The new projects we are working on, built upon the excellent work the organisation has successfully delivered so far, will further boost Cargo iQ’s quality standards. “The new portal enables members to not only see data and trends, but also to act internally to improve levels of quality and fix specific pain points – an important diagnostic tool that will help to translate Key Performance Indicators (KPIs) into material actions.”
NEWS WEEK WORLDNEWS
AIR cargo volumes in Germany rose by 9.7 per cent to 408,694 tonnes in May, according to the ADV (German Airports Association). ADV says the high and stable cargo volume proves the “current positive economic development despite the political crisis”. In the first five months of 2017, ADV reports that tonnage is up 6.9 per cent to 1,958,501 tonnes with exports up 6.6 per cent and imports up 7.2 per cent. DOHA’s Hamad International Airport (HIA) has posted strong year-on-year growth in cargo from January to June of 2017, making it its busiest six month period in its history. The Qatari airport handled 980,000 tonnes of cargo - a significant 19 per cent compared to the same period in 2016. Last year, the Airports Council International (ACI) ranked Hamad as the 16th busiest cargo gateway in the world, handling 1,758,074 tonnes.
SINGAPORE Changi Airport cargo volumes grew by 12.6 per cent in May with improvements for imports, exports and transhipments. It handled 177,340 tonnes in May, with stable recovery of industrial activity in the US, Germany and Japan increasing airfreight demand to and from these markets. May was the second month of 2017 to see a double digit year-on-year increase, with volumes in March rising 10.2 per cent. Changi was welcomed new services and increased frequencies, with Singapore Airlines has added a fifth weekly flight to Moscow and flights to Stockholm as an extension of the Moscow route. Singapore Airlines has also added two additional weekly flights to Sydney, bringing the total to 33 a week. Ethiopian Airlines has also returned with five weekly non-stop flights to Addis Ababa on 1 June.
Delta and Korean pen agreement
DELTA Air Lines and Korean Air have reached an agreement to create a trans-Pacific joint venture, offering a number of services including increasing belly cargo. The joint venture, subject to regulatory approval, mainly focuses on passenger services to expand the trans-Pacific codeshare, joint sales and marketing initiatives in Asia and the US, co-locating at key hubs and enhancing frequent flyer benefits, with cargo customers benefitting from increased belly cargo cooperation across the trans-Pacific. Delta chief executive officer, Ed Bastian says: “By combining the strengths of our two companies, we are building a stronger airline for our employees, customers and investors.” Korean Air chairman, Y.H. Cho says: “Now is the right time for this JV. The synergies we’re creating will build stronger and more sustainable companies, and this is good for travellers, our companies and our countries.” The agreement is the expansion of the partnership between Delta and Korean, which began in 2000 when both carriers became co-founders of the SkyTeam global airline alliance. The airlines will share costs and revenues on flights under the scope of the joint venture. In anticipation of the joint venture, Delta launched nonstop services between Atlanta and Seoul, and Korean Air will introduce a third round trip flight between Los Angeles and Seoul, and a second between San Francisco and Seoul.
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NEWSWEEK Vancouver Airport realising vision of connecting the Americas with Asia
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ancouver International Airport’s (pictured) vision of being the airport connecting Asia and the Americas has been a major driver of growth in recent years, Vancouver Airport Authority vice president of commercial development, Scott Norris says. Cargo has registered strong growth so far in 2017, following record-breaking passenger numbers in 2016, which increased capacity and activity, meaning more cargo at Vancouver. Norris says: “Air Canada continues to build their western hub operations for the Asia Pacific through YVR which contribute to the positive growth in cargo tonnage processed through YVR.” Asia Pacific, specifically China is a major focus area, along with the USA, and Vancouver is looking at Latin America where opportunities present themselves. Norris says: “We align ourselves with industry and other gateways, including Shanghai Airport Authority, which we signed a partnership agreement with to study the cold supply chain between our two markets.” He says the airport is continuing to find innovative ways to improve cargo operations by working with tenants, business
partners and the logistics community. The airport authority set up Vancouver Airport Property Management and acquired buildings in the Cargo Village in 2014. Norris says: “We have set up our management team in cargo village to manage and redevelop facilities and to more closely work with our tenants and business partners in an effort to continue to facilitate and assist with the growth in our cargo gateway strategy.”
“We now have a direct relationship with over 100 tenants in the logistics and cargo industry, which we didn’t have before” he adds. Norris says Vancouver’s approach to increase cargo is multifaceted, aiming to build on its strengths, particularly bringing time critical, temperature sensitive perishables to market. The cargo village occupies more than one million square feet of cargo buildings and warehouse space. Norris says the airport authority is looking at existing facilities, renovations and planning for future expansion as well as working with Canada Customs and industry partners to meet existing a future needs. He says: “For our new terminal developments we are seeking to include new tail to tail cargo transfer facilities to increase the speed and reliability of time sensitive goods.” Improving efficiency is very important, Norris explains: “We are seeking any opportunity to reduce the time and cost of transferring goods and increase certainty of goods transfer. This will be achieved through well designed and appropriately sized facilities.”
Lobsters help Halifax grow 21% CARGO volumes at Halifax Stanfield International Airport grew 21.4 per cent in the first quarter of 2017 due to new direct flights to China transporting lobsters, Halifax International Airport Authority director for cargo & real estate development, Glen Boone (pictured) explains. This follows a record year in 2016 with 4.1 per cent growth to 33,330 tonnes, and demand for lobster and seafood continues to grow, especially to Asia. Boone believes Halifax is poised to keep growing, as demand for Nova Scotia seafood remains strong from China. He says: “Factors contributing to this positive outlook include: our lower Canadian dollar (vs. US) and the removal of an eight per cent duty on live lobster in the EU following the ratification of CETA allows our exports to be very competitive.” China and Asia has surpassed traditional markets, Boone explains: “For many years the Benelux region was our primary export market for our live lobster, however, in recent years that market has been surpassed by the demand for the Nova
Scotia delicacy to Asia and China.” The airport authority has invested in new facilities including a new 17,000 metre apron located near Gateway Facilities, a cargo storage facility housing 40,000 square feet of cargo space, 7,000 is temperature controlled. Boone says: “The addition of the new apron improves turnaround time and makes Halifax Stanfield more attractive to cargo operators who are interested in doing business in Nova Scotia and not only supports our seafood industry, it provides a positive impact to our provincial economy.” Boone sees Canada’s openness to trade as another advantage, saying: “Canada’s free trade agreement with South Korea that came into effect Jan 01, 2015 is already have positive effects for both countries. CETA will be the next measuring stick.”
Qatar to invest in American Airlines QATAR Airways has announced its intention to invest in American Airlines, making an initial investment of 4.75 per cent. The airline says it believes in American’s fundamentals and “intends to build a passive position in the company with no involvement in management, operations or governance.” In a statement on the Qatar Airways website, the airline says: “Qatar Airways has long consid-
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ered American Airlines to be a good oneworld Alliance partner and looks forward to continuing this relationship.” “Qatar Airways plans to make an initial investment of up to 4.75 per cent. Qatar Airways will not exceed 4.75 per cent without prior consent of the American Airlines board. Qatar Airways will make all necessary regulatory filings at the appropriate time.”
NEWS WEEK Nairobi perishables freighter to operate into Doncaster Sheffield
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oncaster Sheffield Airport (DSA) has won a new contract bringing flowers and vegetables to the UK. The airport has secured a deal with Network Airline Management (NAM) who begin a weekly Boeing MD11F service from Nairobi in Kenya to Yorkshire this week. It will be the airport’s first scheduled flight handling perishable goods - opening up a major new market. DSA cargo manager, Dayle Hauxwell says: “We are delighted to be announcing this news so soon after seeing record cargo figures for last year. “We’ll be working with Network Airline Management to handle a weekly scheduled flight from Nairobi with flowers and vegetables for the UK market. This deal will see some 3,500 tonnes of cargo transported a year. This new scheduled operation also opens up the opportunity for UK export freight. “Our entrance into this new market is further evidence that the cargo operation has established an international reputation as the UK’s most freighter friendly airport. And we believe this is just the beginning, as the industry recognises the benefits offered by Doncaster Sheffield Airport. ” DSA was certified as a port of entry for perishable commodities
FSG to manage Somalia project
last year allowing it to access a significant global market. With offices across the globe and handling over 70,000 tonnes of cargo annually, the Network Aviation Group heads up a division of wholly-owned and inter-related aviation companies. NAM operates a fleet of B747F and MD11F aircraft on a scheduled and charter basis throughout the world. The international sales division, Network Airline Services, represents over 20 airlines globally in its capacity as general sales and services agent.
NAM commercial director, Andy Walters says: “We selected to fly to DSA for a number of reasons. It offers a 24-hour operation without being slot restricted, is very freighter-friendly and considerably less congested than other locations. “It also has a very proactive team. Doncaster Sheffield Airport with their partners Anglo World Cargo work hard to deliver a tailor-made service, and this really shone through in their approach.”
SOUTH West State of Somalia has selected Frontier Services Group (FSG) as the project managers for integrated air-land-sea logistics capabilities and advanced security management. The initiative will include constructing a seaport, airport as well as residential areas and agricultural zones for the state’s Free Zone Investment Authority (FZIA) with the aim of creating jobs and stabilising the region for internally displaced persons and returning refugees to engage and invest in their homeland. The projects are managed in order that citizens, entrepreneurs and investors are able to drive the economy of Somalia. FSG executive chairman, Erik Prince says: “FSG has a proven track record of being able to manage complex projects across challenging terrains and is therefore perfectly placed to provide support for this important new project in Somalia.” “With the team’s experience and expertise, FSG will provide the best possible logistics and security services to ensure that the project can operate safely and on time.” President of the South West State of Somalia, His Excellency Sharif Hassan Sheikh Aden says: “South West State is preparing for international investment in infrastructure and local enterprise. We are coordinating efforts according to global standards and best practices.”
Myanmar office for CEVA
CEVA Logistics has opened an office in Myanmar’s capital - Yangon – as part of its expansion in the emerging Mekong markets. For the last five years, CEVA has been operational in the country through a network partner, providing freight management services to a number of multinational and local customers. From June 2017, the company now has its own office, offering air and ocean freight services with access to the CEVA network using one freight system (OFS) – CEVA’s global system which manages all freight movements worldwide. CEVA says Myanmar presents potential for growth with strong demand for both import and export services. Imports comprise mainly industrial materials for infrastructure, consumer goods and machinery, whilst exports of commodities, agricultural products and goods for the retail sector drive outbound trade. CEVA’s managing director for the Mekong cluster, Bruno Plantaz says: “It has a population of some 55 million people who are looking to companies like CEVA to provide supply chain services to support their developing business and meet their requirements.”
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CANADA E-commerce driving growth at Hamilton
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ith demand for e-commerce increases, John C. Munro Hamilton International Airport is positioned to be at the centre of goods movements in Southern Ontario, president and chief executive officer Vijay Bathija (pictured) tells Air Cargo Week. Hamilton Airport has seen double-digit growth so far in 2017 and the outlook for the rest of the year is good, driven by e-commerce alongside perishables and high value items. Bathija says many carriers use Hamilton to serve the Greater Toronto and Hamilton Area market for e-commerce and meet tight deadlines. Hamilton is the largest express cargo airport in Canada, and the base of the cargo airline Cargojet. Bathija says: “Hamilton International provides connectivity on regular scheduled flights to all major cities across the country, so any
goods coming from outside Canada get efficiently distributed through Hamilton to all destinations in Canada.” E-commerce has been the main growth area, and Bathija comments: “Many consumers order goods online from domestic and international locations and so airfreight is bound to grow
further as consumers typically will only wait no more than a day or two for their order.” Hamilton has also increased cool chain capacity, Bathija explains: “In June 2015, Hamilton International built a new 77,000 square foot Cargo Centre facility which is generating lot of new business. Hamilton International continues to work with tenants to address additional space requirements for future needs and plan these multi-year development projects.” The main challenge in Canada is its size makes moving goods at low cost difficult and relatively small markets due to the low population density. Despite this, Bathija says: “By being the largest express cargo airport with 24/7 uncongested facilities and having express cargo airlines based at Hamilton International, the airport offers opportunities to move goods efficiently and consequently at lower costs.”
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CARGO volumes in Montreal have risen substantially over the past two years, hitting 191,651 metric tons in 2016, according to figures from Aeroports de Montreal (ADM). Volumes grew from 165,434 tonnes in 2014 to 175,924 tonnes in 2015 before hitting 191,651 tonnes in 2016. Revenue for ADM, which operates both Montreal Pierre Elliot Trudeau International Airport and Montreal Mirabel International Airport, rose to $527.1 million in 2016, while EBITDA increased to $254.2 million.
Perishables increasingly important for EIA
OIL and gas continues to remain very important for Edmonton International Airport (EIA) but other sectors including perishables are growing, the airport explains. Edmonton is known as a manufacturing hub for the oil and gas industry, home to companies including Haliburton, Schlumberger, Baker Hughes, Weatherford and Trinidad, meaning a lot of cargo is related to this. Perishables are proving popular to markets like Japan, and China is also leading Asian market development. European services are increasing, EIA says: “Increasingly perishables and agrifood products are the growth sectors, as new supply options to Europe open through Amsterdam with KLM, and Reykjavik with Icelandair. Our integrator carriers also provide excellent access through their Memphis (FedEx) and Cincinnati (DHL) gateways.” EIA has some large expansion plans including the world’s largest pharma medical marijuana facility at 800,000 square feet, to be operational in the fourth quarter of 2017, with 80 per cent of distribution dependent on air cargo. A 680,000 square foot outlet mall is also due to open in the fourth quarter, as is a 30,000 square foot freight forwarder build-
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ing, and a Chinese technology incubator giant will establish its first Canadian office in Edmonton. EIA believes its location at the geographic centre of Western Canada gives it the most efficient access to the West of the country, with cities including Vancouver, Winnipeg and Manitoba within 24 hours by road. It was also a founding member of Port Alberta, a designated Free Trade Zone providing duty and tax relief for existing or potential investors, manufacturers and distributors. EIA’s location provides access to the mining industry, it says: “Additionally EIA is located atop the third largest proven oil reserves in the world, with three refineries within 45 minutes of the airport and a fourth in construction, providing excellent Jet A fuel capabilities and pricing to air carriers on the Trans Pacific Polar Route.” Across Canada the growth of e-commerce is reducing the need for freighters, but EIA’s focus on oil and gas means it will continue to services these aircraft. EIA says: “We believe EIA as the Oil & Gas Manufacturing Hub of Canada and the big ugly heavy freight it produces (which we find beautiful), will continue being a freighter airport in the long term.”
CANADA
Unique needs means special cargo for G7 capital city
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ttawa Macdonald Cartier International Airport believes it can use its geographic location to provide an alternative to other airports including Toronto and Montreal, Ottawa International Airport Authority tells Air Cargo Week. Ottawa describes cargo performance this year as “So far, so good” describing it as “consistent”, having handled around 22,000 tonnes a year, primarily outbound. It admits the Ottawa cargo market is not at the same global scale as the likes of Toronto and Montreal from an industrial and consumer goods perspective but points out: “What makes us unique is that Ottawa is a G7 capital city; therefore, government’s unique needs frequently require special cargo operations like foreign aid.” The Ottawa-Gatineau region supplies Northern Canada with goods from axel grease to zinc supplements as well as government business. The airport explains: “Being part of the northern supply chain is rounded out by government business, including unique operations like the shipping of currencies as Canada prints
currency notes and presses coins for other nations. Internally, we refer to these operations as “Money Planes”, for obvious reasons they have unique security needs.” Ottawa can also provide capacity as an alternative to other airports in the region, explaining: “As Toronto and Montreal experience mounting capacity challenges, we’re an excellent alternative as Ottawa is geographically located between both markets.” It adds: “Like most other airports with cargo activity, we see this is an important part of our operation and vision to be an economic engine for Canada’s Capital Region.” Ottawa says the outlook for Canada is strong, “Especially given that the current US government is signalling protectionist policies, this is an opportunity for Canada to further step up on the global stage.” It adds: “Canada has a positive global reputation for a reason -- we’re open for business and great people to deal with!”
High value focus for Toronto Pearson TORONTO-Pearson International Airport’s strategic plan for cargo needs to reflect the increased development and flow of global trade of high value cargo, Greater Toronto Airports Authority (GTAA) says. It is becoming a mega hub airport, with numerous nonstop daily flights to the world and the strategic plan needs to reflect the importance of cargo travelling through the Greater Toronto Hamilton Area. GTAA says: “As our economy continues to strengthen and more nonstop international destinations become available we expect air cargo to grow at an industry average annual rate of 4.7 per cent.” Exports passing through Toronto grew from $31 billion in 2015 to $35.2 billion while international cargo has grown from 204,000 tonnes in 2013 to 312,000 tonnes in 2016. The primary exports coming through Toronto Pearson in 2016 were gold, pharmaceuticals, aircraft parts, live lobsters and other seafood, ginseng roots, live eels, eggs of fowl and cattle feed. Pharmaceuticals, manufacturing parts, clothing, earth worms and tomatoes remained the most popular imports. Toronto Pearson is connected to 67 per cent of the world’s economy through non-stop, daily flights, which GTAA says provides ample opportunity for businesses to reach international markets. GTAA says: “It’s also important to note that Toronto Pearson is located in close proximity to the financial centre of Canada (Toronto) and the most densely populated region of Canada (southern Ontario).” Though Toronto Pearson does not plan any major updates to existing facilities, it has room to grow within its space; it is developing a new cargo strategy to support the vision to become a mega hub airport. GTAA says: “Our strategic plan for cargo will need to reflect the increased development and flow of global trade of high value cargo items through the Greater Toronto Hamilton Area.” It says Canadian companies gain business on account of reliability and high quality products and services, says: “Coupled with the high level of connectivity that Toronto Pearson offers, means that Canadian businesses and international buyers have streamlined access to our market and vice versa.”
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ASSOCIATIONS
Trump arrival set to have a positive and negative effect
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S freight forwarders’ biggest concern is the overload of regulations at home and abroad, according to Airforwarders Association (AfA) executive director, Brandon Fried (pictured). On a positive note, Fried says the new US administration under President Donald Trump is promising to reduce the number of regulations and the AfA’s primary concern is dealing with the new administration and its promise to reduce the “overwhelming amount of regulations concerning our
industry”. “President Trump issued an Executive Order requiring for every new regulation proposed, two must be eliminated. We see this as an opportunity to reduce some of the regulatory burden forwarders and their partners face today,” he says. He says AfA’s members would also like to see the adoption of uniform standards for communication of key shipment milestones. “Such an initiative would improve quality through concise definitions of terms and accurate status updating to eliminate confusion,” Fried says. Although nothing has actually changed for US forwarders since Trump took over, Fried feels there is a glimmer of hope that regulatory excess will be reined in, but how much remains to be seen. For trade, he says the main concern is devel-
opments on bilateral agreements with the nations that would have been partners in the Trans Pacific Partnership (TPP) until Trump backed out of negotiations and it is also expecting revisions to the North American Free Trade Agreement (NAFTA) as this has been promised as well. Fried says AfA members are worried about protectionist trade policies: “We are all watching it closely and of course, remained concerned. However, forwarders believe that when proverbial doors close, windows of opportunity open and are confident this will be the case.” As US involvement in TPP is for the foreseeable future, in Fried’s words “not going to happen” he is optimistic on NAFTA as time and talks move forward, “sensible change and refinement will ensue”. “The pact probably needs some revision as many industries, including e-commerce did not even exist when the agreement was signed 23 years ago,” he adds.
Thrive on change
Fried also feels Brexit could prove challenging for forwarders as they will need to “stay abreast of the complex regulatory impact on UK trade that is likely to occur”. As the freight business evolves it does offer forwarders opportunities and challenges and Fried believes they are one and the same – adapting to rapid change on all fronts be it political, markets, or technology. He is upbeat about the future as feels forwarders have “thrived on change” - albeit some better than others. One key future area for is digitising processes to meet changing market demands. Fried says US forwarders have embraced automation to
varying extents for the past five decades. “Today it is seeing more evolution than revolution as marketplace diversity does not allow for a onesize-fits-all solution. Instead, we are seeing the development of solutions specific to each forwarder’s market niche,” he adds. But are forwarders’ embracing e-commerce? “For those that wish to participate in the e-commerce niche, yes, but not all do. One major area of concern is forwarders have a level regulatory playing field vis-à-vis the integrator carriers and post offices,” Fried says. On Amazon, he says it seems to be an “integrated carrier taken to the next level” and will have an impact on traditional consumer goods supply chains, but industrial goods sourcing and logistics may not be impacted the same. Fried welcomes virtual forwarders like Flexport. “We believe there is a niche where these folks can thrive. However, it is unlikely that even ‘virtual forwarders’, will be able to solve all supply chain challenges all the time,” he adds. There impact on forwarding has been seen in some niches, Fried says, just as others before them they have shaken up the status quo. He adds: “Let us remember predictions about FedEx, UPS, and DHL causing the death of forwarding never materialised and in fact, each of them now has a forwarding division. “But what may work well in the one-off transactional environment doesn’t always lend itself to the complex challenges often encountered in the supply chain world. At the end of the day, someone must stand up and move the boxes.”
Asia Pacific continues to fly high
AIRLINES in Asia Pacific continued to grow in May with a 12.2 per cent increase in freight tonne kilometres (FTK), the Association of Asia Pacific Airlines (AAPA) says. Cargo measured in FTKs were up 12.2 per cent in May to 5.8 billion and capacity in available FTKs (AFTK) grew by 4.3 per cent to 8.9 billion, pushing up load factors by 4.7 percentage points to 65.6 per cent. Between January and May, FTKs increased
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10.5 per cent to 27.8 billion, AFTK was up 3.6 per cent and load factors rose four percentage points to 63.6 per cent. AAPA director general, Andrew Herdman says: “The ongoing pick-up in the global economy, accompanied by increased consumer and investment spending has provided a boost to both international air passenger and air cargo markets. Asian carriers are major players in the global air cargo market, and continue to benefit from the upswing in trade growth.” Herdman says though the outlook is positive, profitability is constrained by yield pressures and higher operating costs.
ASSOCIATIONS
New initiatives for TIACA and board happy with progress
T
he International Air Cargo Association (TIACA) has been branching out and is running new initiatives as it looks to grow its global presence and industry influence. TIACA’s newest board member and Brussels Airport’s head of cargo, Steven Polmans (pictured below) sees the association playing a major role in future in bringing air cargo airport communities together and linking them up. Speaking to Air Cargo Week (ACW) at air cargo europe, Polmans who was appointed to the board in September last year said: “I am a big fan of cooperation between different companies and stakeholders of an airport, which is how we developed the cargo community in Brussels. “I am pretty sure that in the end if all these cargo communities are going to be established we will come to a kind of global organisation, which is basically TIACA.” Polmans is confident TIACA has a lot to offer moving forward and is happy with the progress it is making, and said it is still a valuable organisation, as long as it can “deliver what it should deliver”. “If you see the people who are now participating on the board and the ideas coming out of it, I really feel comfortable and aligned with the ideas we have. “But we have to make sure in the next months all the ideas we have been working on in the last six months that we can start delivering them and that we can bring them to the market. We have some nice projects in the pipeline,” he explained. His views were echoed by TIACA chairman and Delhi International Airport head of cargo, Sanjiv Edward (pictured below) who said the association is progressing on a variety of fronts. Speaking to ACW, he said: “We are building on the foundations we have laid since I took over as chairman (in 2015). One of the initiatives was how do we engage more globally,“ Edward explained. Another key area he highlighted, which is gaining traction was bringing industry associations, regulators and the TIACA team together to interact on a range of issues important nationally and locally, through events and meetings. Working with the likes of ICAO, ACI, and other trade and aviation organizations is also a high priority of new director general, Vladimir Zubkov who took over in January.
New TIACA programs such as the ‘Young Leaders’ initiative to encourage transparency and consultancy will also feature along with a pharma track in collaboration with the Health Technologies Distribution Alliance. The ‘Young Leaders’ project’s first event in the Netherlands earlier this year was a success and TIACA is looking to hold other events around the globe. “We are strengthening our training because it is one our three pillars – knowledge and education - such as the talent initiative, which will be rolled out to other countries,” Edward explained. Edward said it is the right time for TIACA to invest in areas like training and events while air cargo is on the up: “There is a lot of positivity (in air cargo) and I think this is also the right time for us to invest in terms of resources and in terms of time and see how we can raise the service standards within the industry to make
sure airfreight remains the preferred choice of transport.” ES will take place every two years and TIACA’s Air Cargo Forum will be held every two years in the year ES does not take place. TIACA is also branching out and co-hosted the ICAO Meeting on Air Cargo Development in Addis Ababa with ICAO from 27-29 June. The association is also looking into adding other regional events across the globe.
Events revamp
One area TIACA is focusing on is in revamping its own events as it looks to grow their appeal, reach and presence. This has included an overhaul of the Executive Summit (ES) and AGM, which will take place in Miami this year from 18-20 October - in partnership with Supply Chain Americas. “We are bringing some new ideas and making it more interesting as there is a supply chain conference and good shipper presence alongside our event,” Edward explained. The ES program will feature discussions on supply chain innovation, as well as updates from North American and European regulators on the latest Pre-Loading Advance Cargo Information (PLACI) rules and dangerous goods regulations. TIACA’s Shippers’ Advisory Council (SAC) will lead sessions exploring the different needs of the customer and exploring new ways to better collaborate. Sessions will also include on South America, unmanned aircraft, digitisation, lithium batteries, and there will be a focus on quality in terms of building airport communities, the launch of new shipper KPIs and the TIACA Airport Cargo Service Quality initiative. Edward will chair the session launching the cargo service quality initiative that will create a cargo service quality tool that will initially measure service levels at gateways. “Airports and cargo terminals form a vital link in the supply chain and these initiatives will help bring efficiency to the supply chain as well as empowering the shipper community,” said Edward.
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AIR PHARMA ROUND-UP
Schiphol targets more pharma group members
P
harma Gateway Amsterdam (PGA) is looking to add members to further improve cooperation, collaboration and transparency in the pharma supply chain at Amsterdam Airport Schiphol. AirBridgeCargo Airlines was the latest to join last month and the second airline to sign up to the 14-member quality pharma initiative, which was set-up in March 2016. Head of cargo, Jonas van Stekelenburg (pictured left), expects a few more “big players” to join in the coming months and widening the membership is a key priority. “We aim to substantially increase the number of participants: the more Schiphol players focused on quality and transparency, the better it gets. “Furthermore, we aim for everyone to obtain their IATA CEIV Pharma certification (or comparable quality standard) as quickly as possible. With this, everyone talks the same language and we can cooperate in more areas of the pharma logistics chain,” van Stekelenburg says. PGA has recently started an early warning project for pharma shippers, which will help move cargo more quickly and safely through Amsterdam and it received a €1 million research grant,
which will fund data collection and monitoring PGA shipments to identify changes, such as temperature incursions. “This data will then be used to design a model to alert shippers to issues with their consignment. With this project, we aim to add something valuable that wasn’t there before,” van Stekelenburg explains. In the first five months of 2017, Schiphol has seen pharma cargo grow by 8.5 per cent, although this is more or less the same
growth as general cargo. This is more than it expected according to van Stekelenburg, but growth numbers were not the primary focus and this year the emphasis has been on enhancement of quality and service. And it has been busy attracting more members, getting more (CEIV or other) quality training for community members, supporting projects to improve quality and transparency of the pharma logistics chain, and supporting community players in attracting more business. All carriers at Schiphol are driving pharma traffic van Stekelenburg says, but the key trade lanes are to and from the US, while Europe he notes is exporting a lot to Asia. He says: “All this traffic is going for the most part via Schiphol. This is not different to other airfreight: within Europe we truck cargo and outside Europe cargo is flown. Schiphol is known for its quality and efficient handling, and has the most direct destinations in the world. This is unprecedented and exactly what pharma wants: flown as direct as possible.” PGA has had an impact on pharma traffic in van Stekelenburg’s view: “PGA participants all boosted the quality and the transparency of their operations. The community approach all kick started this - we collectively procured the training. “Furthermore, we worked together in getting an even better cooperation with Customs and in getting the message out. This all resulted – as we heard back from PGA participants – in higher customer satisfaction and more business.”
K + N starts pharma hub
A ground breaking ceremony has taken place for Kuehne + Nagel’s “Pharma Hub Switzerland” in Möhlin. The Pharma Hub will be part of the KN PharmaChain network providing multimodal temperature-controlled doorto-door shipping on a global scale, enhanced visibility and traceability of deliveries and proactive risk management. The facility will provide 16,300 square metres of logistics space, which will be used to manage approximately 46,000 pallet spaces using a warehouse system combining manual and automatic operation. Three different temperature zones will be available for highly sensitive products: -20 degrees, -2 to +8 and +15 to 25 degrees, with dedicated areas for hazardous goods and narcotics. Kuehne + Nagel International chief executive officer, Dr Detlef Trefzger says: “Switzerland is an important pharma location with global reach. “The cutting-edge facility in Möhlin is a strategic investment in this growth sector and supports us to serve our customers even better, especially through integration with the global Kuehne + Nagel pharma network.” The ceremony was attended by mayor Fredy Boeni, Kuehne + Nagel International majority shareholder, Klaus-Michael Kuehne, and Kuehne + Nagel CEO, Dr Detlef Trefzger.
CEIV for CEVA in Singapore CEVA Logistics has gained IATA’s CEIV Pharma status at its facility in Singapore. CEVA staff in Singapore undertook the training program conducted jointly by IATA and Changi Airport Group. A team was established at the company’s facility at the Air Logistics Park of Singapore (ALPS) within the Free Trade Zone and this group coordinated and implemented the CEIV process. CEVA’s senior vice president of freight management for South East Asia, Michael Yip says: “Our 90,000 sq feet facility is fully accredited for the full range of active and passive temperature ranges. We are the largest user and operator of active RKN e1 equipment outbound from Singapore and this new CEIV status recognises the full scope of our capabilities.”
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