Newsletter – March 8, 2024

Air cargo’s “surprisingly” strong start to 2024 continues in February
aircargonews.net
The air cargo market reported another double-digit percentage increase in demand in February continuing a “surprisingly strong” strong start to the year as e-commerce boosted demand levels.
The latest figures from data provider Xeneta show that air cargo demand increased by 11% year on year in February, while the dynamic load factor improved by four percentage points on a year ago to 60%. Read more here.

Freighter operators face margin squeeze
aircargonews.net
Operating freighter aircraft has historically been a business with tight margins, a market environment temporarily interrupted by the Covid-19 pandemic. Recent airline financial statements again show (more familiar) marginal profitability levels, despite yields that remain 35%-40% up on 2019 figures.
For the two decades ahead of Covid-19, the air cargo industry faced increasing pressure on yields, as a continuous influx of cargo-friendly widebody passenger aircraft combined with steady additions to the global freighter fleet led to sustained growth of global air cargo capacity. Read more here.

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OCEAN FREIGHT UPDATES

Contract-shy BCOs eye a shift to index-linked pricing
theloadstar.com
Shippers have been reluctant to sign new contracts with ocean carriers, citing uncertainty about the market outlook and volatility – and some argue it’s time to move to index-linked pricing.
“Long-term fixed-price contracts no longer serve shippers or carriers,” said Ian Arroyo, chief strategy officer of Freightos. Read more here (login required).

Ocean Network Express teases network changes for 2025
supplychaindive.com
Ocean Networks Express plans to disclose a new network solution and products for 2025 next month, CEO Jeremy Nixon said Monday during a session at TPM24 by S&P Global in Long Beach, California.
Among the new offerings, Nixon teased ONE would bring back its PN3 service from Asia to North America. The service was suspended in Oct. 2023 due to market conditions. Read more here.

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INTERNATIONAL BUSINESS – GOVERNMENT UPDATES

U.S. trade czar: Don’t get ‘too comfortable’ North American trade pact will stay as is
cbc.ca
Don’t get too comfortable with the North American trade pact: that’s the warning from President Joe Biden’s top trade official as countries prepare to review the deal.
Katherine Tai made the comments as the agreement between Canada, the U.S. and Mexico, known in the U.S. as USMCA, passed the halfway point toward the six-year mark where countries will start discussing its renewal. Read more here.

EU Advances Ban on Products Made with Forced Labor
strtrade.com
Negotiators from the European Parliament and European Council reached a provisional agreement this week on a regulation to prohibit products made with forced labor in the European Union market. The regulation covers all products, including imports as well as goods made in the EU for domestic consumption and export. Read more here.