Soaring air freight costs, shipping cancellations upset global supply chains: insiders
Soaring air freight rates and rising cancellations of trips by cargo ships due to the COVID-19 pandemic have put further pressure on global supply chains. according to insiders.
SINGAPORE, VNA - Soaring air freight rates and rising cancellations of trips by cargo ships due to the COVID-19 pandemic have put further pressure on global supply chains. according to insiders.
Most of the airlines around the world have cut their operation by 90 percent, significantly reducing global freight capacity. Freight rates are rising daily because demand is far beyond capacity, President of the Singapore Aircargo Agents Association (SAAA@Singapore) Steven JK Lee said.
Vincent Phang, CEO of Singpost, the country’s postal service provider, said it has been suffering from suspensions and delays in mail and freight deliveries to and from many countries. It has also incurred growing air freight costs because there are only a few flights each day. Rates for VIP customers are now two or three times higher, while those for ordinary customers have gone up six to ten-fold.
The situation has become even worse as more and more shipping lines have cancelled or halted trips without notice.
Raymon Krishnan, President of the Logistics and Supply Chain Management Society of Singapore, said it’s not just about the number of trips but also how they are being cancelled or halted.
Shipping lines used to provide notice about cancellations three to four weeks in advance, but as COVID-19 has spread globally, cancellations or suspensions are effective almost immediately. - VNA