When flights grind to a halt, what does that mean for those products relying on swift transportation because of their make-up or importance for supply chains overseas? IATA hosted a webinar on 02JUN20 which discussed the COVID-19 impact on Special Cargo.
4.5 million is the number of flights that have been cancelled up to 30JUN20 as two-thirds of all commercial aircraft are currently grounded, with an additional couple of million flight cancellations expected by the end of this year. That is the current situation according to IATA Head of Cargo Glyn Hughes and translates into a reduction of around 40% in cargo capacities since MAR20. If planes are not flying, people and goods are not moving, airlines, airports, and all those involved in and at the end of supply chains are losing money. That all points to a very bruised global economy in the end – many countries are forecasting GDP contractions of 5% and more.
Pharma demand doubled
Whilst those economy contractions will have a negative, knock-on effect on production and consumption over the next months and possibly years, demand for special cargo in the last three months has increased, and in the case of pharma, has doubled. Over 70% of all pharma requires strict temperature-controlled conditions and handling has to adhere to specific standards: an unprecedented challenge, therefore, of how to shift those pharmaceutical products, above all safely, when capacity and routes are so limited.
Another interesting challenge to come, is how to deal with a sudden huge surge in global vaccine shipments once a COVID-19 vaccine is developed? This will require a very agile and responsive solution in a network where not all carriers currently handle or transport special cargo, so training and compliance will be paramount.
Safety and restraints
Safety is a core topic for all sensitive products, and one that has been largely hindered recently by government and regulatory authorities imposing curfews, social-distancing, and quarantine regulations, along with resource problems due to staff falling ill or having to deal with personal challenges. So, having enough qualified staff available at the various shipment interfaces, as well as a sufficient supply of appropriate loading material and correct storage facilities at locations perhaps not used to dealing with these kind of shipments, have all been problems requiring solutions on a daily basis during corona. On top of all that, the risks of flights being delayed or cancelled, greatly extending the product’s journey time, or leading to it having to be destroyed (more in our report: Pharmaceuticals and air cargo: How global cooperation keeps pharma logistics running in times of crisis).
The dangers in handling Dangerous Goods (DGR)
Given the lockdowns in many countries, their authorities have often decided to authorize an extension of their DGR certificates for up to 6 months. While this is a relief for those handling companies dealing with DGR on a daily basis, it also poses a risk: employees who have been furloughed or are not in regular contact with DGR, need to refresh their knowledge of DGR to ensure safe handling. David Brennan, Assistant Director, Cargo Safety and Standards, IATA, speaking on the topic, urged companies to ensure that staff are given sufficient support and time to reacquaint themselves with the topic.
Given that over 1,600 passenger aircraft have been converted to freighters, this poses second risk as some airlines may not be familiar with the transportation of DGR. Again – training is essential. All the more so, since DGR is not authorized in the cabin given the lack of adequate fire protection, and therefore staff need to recognize the hazards. He pointed to digital solutions, such as the DG Autocheck, to support safe handling of DGR shipments.
Food, Flora and Fauna
All these specials faced severe disruptions with the crisis. Perishables such as fish, fruit & vegetables, and general perishables saw declines in tonnage of between 30-60%, flowers declined by 18%. Those countries depending on these exports were greatly impacted – first by lack of capacity and second by huge increases in rates when shipments were possible. Yet also the backend to the supply-chain suffered from shut-down regulations, given the lack of labor available to plant, harvest and package perishable items. Whilst live animal transports are slowly starting up again, some fractions such as day-old chicks, pigs, and bumblebees, all necessary for food supplies, are still restricted, with the knock-on effects this has on the other end of the supply chain. Andrea Gruber, Head Special Cargo, IATA, illustrated the work IATA has been doing with governments to find solutions to keep supply chains running.
Whilst the global economy is seeing a downturn overall, a poll held during the webinar revealed that most participants anticipated an increase in special cargo of between 1% and 5% annually over the next 3 years.
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