Cargo charter flights out of China have been cancelled as a result of a rapid decline in e-commerce demand to the US, according to freight forwarder Dimerco.
In the forwarder’s monthly market report, Dimerco reported that from the end of April, several freighter charters have been cancelled, while further cancellations are expected in the coming weeks.
Dimerco said the cancellations were the result of the US implementation of tariffs of up to 145% on many imports from China and the impending end of the de minimis exemption for the country that has allowed Chinese e-commerce platforms to import millions of packages per day without paying duty and with minimal customs scrutiny.
The de minimis exemption on goods from China and Hong Kong is due to end on 2 May. Meanwhile, the US has put in place tariff exemptions for smartphones and other tech products imported from China, products typically carried by airfreight.
“Overall, e-commerce shipment volume has dropped by approximately 50% since mid-April compared to the same period last year.”
The company said major Chinese carriers were also considering cancelling services, although a final decision is still pending.
“If these cancellations go through, the already limited capacity from China to the US will be further reduced,” Dimerco said.
Dimerco Express vice president, global sales and marketing Kathy Liu said that much of the freighter capacity has been shifted to destinations like Nuevo Laredo in Mexico and other parts of Latin America, where demand has actually gone up, especially out of Mexico.
”For shipments to the US, a lot of shippers have hit pause,” Liu said. ”With the uncertainty around new tariffs between the US and China, many are holding back on placing new orders.
“But what’s interesting is that demand out of Southeast Asia and Taiwan has stayed relatively stable. That’s likely due to the 90-day tariff exemption granted by the US government, which is giving some breathing room to shippers in those regions.”
Spot market airfreight rates have also declined in recent weeks, according to sources. From Hong Kong to the US, spot rates are down around $1 per kg since the start of the month, now tracking at around $4.40 per kg.
Data monitor WorldACD said that air cargo volumes from China and Hong Kong to the US have fallen for four weeks on the bounce, in the week ending April 20 (week 16) dropping by 7% compared with a week earlier.
Meanwhile, the data firm added that demand from Southeast Asia to the US was on the up.
”Compared with week 16 last year, China and Hong Kong to the US combined traffic is down by 16% – contrasting with a 3% drop for the Asia Pacific region as a whole to the US, driven by stronger exports from Vietnam (+42%), Taiwan (+30%), Thailand (+24%) and Japan (+12%). These figures do not include increased charter activity,” WorldACD said.
Source: https://www.aircargonews.net/supply-chains/china-cargo-charter-flights-cancelled-as-e-commerce-volumes-plunge/1080033.article
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