Continental cargo transports in the sub-Sahara are increasing rapidly, outgrowing traditional flows to and from Europe or the Asian-Pacific region. This puts some pressure on non-African cargo carriers to widen their reach by either expanding their network covering as many continental destinations as possible or – second option – partnering with a local capacity provider for pan-African distribution of their shipments and enabling feeder services.
When CargoForwarder Global tabled this issue to Lufthansa Cargo’s Africa Director Hermann Zunker the manager said that both approaches are part of his carrier’s strategy for sub-Sahara Africa.
“We grow our African network step by step and simultaneously keep our eyes open to partner with local capacity providers.”
Concerning the first point Herman notes that his airline is currently investigating if upping the weekly freighter rotations between FRA-JNB-NBO-FRA from 4 to 5 makes commercially sense. He also mentions that LH just decided to resume passenger flights between Frankfurt-Main and Nairobi beginning end of October, by operating an Airbus A340-300 four times a week. This results in additional capacity for cargo in the holds of the aircraft.
Partnering with Astral
Regarding the issue of cooperation Zunker refers to Astral Aviation (based in Nairobi) that his carrier partners with for onward air-freight to the regional economies of Eastern Africa comprising of Uganda, Tanzania, Rwanda, Somalia and South Sudan.
Astral operates a mixed freighter fleet of Boeing 727-200F, DC-9F, Fokker 27F but also an Atlas Air wet leased Boeing 747-400F which is deployed mostly on routes to and from Europe. The carrier intends on consolidating cargo at Lagos and Johannesburg, building sub-hubs to better serve the western and southern parts of Africa, a project scheduled to be realized in 2016 or 2017 latest.
The intended expansion of the carrier’s pan-African reach should be music to Zunker’s ears who is keen on further developing Lufthansa Cargo’s African range.
According to Herman, roughly 70 percent of all the exports generated between Cape Town and Cairo stem from three markets: South Africa, Kenya and Egypt. “At these key markets we have our own sales teams and we serve Johannesburg, Nairobi and Cairo with all-cargo aircraft, guaranteeing a high degree of representation,” states the manager. He notes that LH Cargo has got an excellent reputation in Africa, setting the benchmark for product quality and reliability.
Still unbalanced movement of freight
Hermann adds to this that air freight is running strong particularly in Egypt and Kenya, whereas South Africa is currently reporting only minor growth.
Nevertheless all sub-markets have one thing in common: traffic remains unbalanced, with exports and imports differing considerably, depending on the local market situation. While the Kenyan export-import ratio in air freight is 80/20 thanks to the thriving flower biz, Egypt reports an export/import correlation of 60/40 and significant seasonal fluctuations. In contrast, only 35 percent of all cargo handled in South Arica is flown out while 65 percent is brought in (by air).
5th freedom right blazes the trail
The imbalance is actually reinforced by the different values of most products, with high-quality goods such as machinery parts, IT equipment, special and dangerous items or pharmaceuticals flown southbound, whereas African exports consisting predominantly of lower yield products like perishables, raw materials or semi-finished goods going north. “In 2014 and during the first months of this year we were very successful, capturing additional market share in South Africa,” states Manager Zunker.
It certainly helps that LH Cargo can capitalize on the Fifth Freedom granted the carrier in 2011 for transporting shipments on flights between Johannesburg and Nairobi, where the freighters stop over on their way to Frankfurt. “About 60 percent of the tonnage uplifted in Johannesburg by our MD-11Fs is destined for Jomo Kenyatta International,” explains Herr Zunker. The remaining 40 percent are bound for Frankfurt, complemented mostly by large quantities of agricultural products, predominantly flowers, harvested in Kenya and uplifted in NBO.
South Africa is becoming a distribution center for cargo
As to the role South Africa plays in air freight, Zunker observed that particularly Johannesburg is turning into a kind of a distribution center for the entire continent. Mainly because of the advanced technical and infrastructural conditions Jo’burg’s O.R. Tambo International offers in comparison to most other African airports. “Due to e-AWB and electronic data exchange about two thirds of the arriving freight is pre-cleared by local customs,” he states, adding to this that “speed is the decisive factor in cargo, which is increasingly competing with ocean freight.”
On another note, Herman refers to data showing that roughly 66 percent of all African air exports are flown to Europe or transited at hubs like FRA, LHR, AMS or CDG, whereas only 6 percent are destined for Asia-Pacific. “The Asian traffic pie grows as does the European but both are outdone by intra-African air transports.”
Which seems to make close cooperation with local capacity providers all the more necessary?
Heiner Siegmund / Michael Taweel