AIRFREIGHT RATE ROLLERCOASTER HELPS NO-ONE

The see-saw pricing strategy adopted by airlines over the last 12 months is leaving customers confused and less certain how to budget their freight costs. The time for stabilised airfreight rates is now.
 
Air cargo is starting to increase again in most trade lanes which, given the reduction in the passenger flights, has resulted in capacity shortages and the inevitable increase in rates. The airlines are now saying that the rate previously quoted may be valid, but they are unable to offer capacity since the yield is too low.
 
This means that importers and exporters who have secured orders on the back of quoted freight rates will now either have to revise their selling prices or reduce their profit margin and, in many cases, make a loss merely to complete the order.
 
It is in the best interest of importers, exporters and freight forwarders to have a strong air cargo industry to support global trade and this means that airlines have to make a profit. Therefore air cargo rates must be realistic.
 
The message from UFL to our customers at this time is to be wary of freight forwarders offering any rates that seem too good to be true since, as we move into ‘peak season’, they probably will be. The price quoted must be at a level that will ensure uplift of the cargo and even then, with increasingly fewer flights on major trade routes, it is still necessary within the supply chain planning to allow for potential delays.
 
We believe that, through our network of offices in Europe, the USA and across Asia, we are on the spot in the global freight ‘hotspots’; and thus able to best advise our customers on a day-to- day basis as the market changes.