Sea freight congestion boosts airfreight sector

Freight News by Liesl Venter

In a strategic move to strengthen its footprint and enhance its shipping solutions, SACO CFR is set to expand its export consolidation service in 2024. The neutral consolidator has just unveiled a service connecting Johannesburg and Heathrow, marking a significant milestone in its continuous efforts to streamline international trade.

According to Jacob Pretorius, general manager for airfreight, this comes on the back of a difficult 2023. “The past year was not easy for the airfreight sector,” he told Freight News. “It was a year when one had to fight for every kilogram. Plentiful space was available, but rates were high compared to ocean freight. Our hopes are high that 2024 will be a better year.”

With the congestion problems experienced at the ocean ports by Transnet in December, the airfreight business saw a significant uptick at the end of the year as cargo owners opted to move freight via air to keep supply chains moving.

“Ocean carriers implemented surcharges to recover losses experienced from being parked outside the Port of Durban for 20 days or more. In general, there are also talks of shipping lines increasing their freight rates by 1-5% due to other affected areas, like the Panama Canal, where they have reduced the number of vessels being off loaded per day and standing times per day have tripled compared to the past. These will all contribute to bringing more cargo back to airfreight,” said Pretorius.

Another possible development the sector looks forward to is the return of the traditional peak season at the end of 2024. “Overstocked warehouses from previous years should be depleted, and importers will once again need to increase stock for their year-end sales around the holiday season,” said Pretorius. When asked about challenges, he said that space on export services could have been more constrained due to an increase in perishables at the end of 2023. “Adding to these volumes were perishables that would normally move via reefer containers, which had turned to airfreight due to the port situation in Durban in December. The airlines could only assist after 15 days in some cases.”

He said finding space would be challenging if the port situation continued into the first quarter of this year.“Perishables are moved right through until March, and cargo owners will continue to take up airspace if the produce can’t sail. The fuel price is still a big concern, and should this rise again, it will negatively affect the airfreight rates.”

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