Peak season, vaccine delivery keep cargo charters in action

Ever since the pandemic fractured cargo capacity, the African continent has been highly dependent on a handful of African players and foreign airlines for capacity. For now, current charters flying into Africa are essentially substituting the gap of passenger belly capacity. With the peak season for flower and perishables exports and the movement of Covid-19 vaccines gaining ground, the regional cargo carriers are seeing new charter opportunities.

Something that was common for almost everyone across the globe was that 2020 was a year unlike any other. The Covid-19 pandemic pushed the world into a state of flux; it has been a year since the outbreak but the uncertainty still lingers.

Despite all the uncertainty, it has been a busy year for the air cargo sector. Even as capacity was crippled, the sector with its cargo charters, has been delivering almost everything – from PPEs to pharma supplies to flowers to essentials to the much-awaited Covid-19 vaccines. According to the January data for The International Air Transport Association’s (IATA), Africa was one of the strongest performers. Cargo demand from African airlines surged 22.4 percent in January in comparison to the same period in 2019, eclipsing the 6.3 percent year-over-year increase for December 2020. Robust expansion on the Asia-Africa trade lanes contributed to the strong growth.

“The demand on cargo charters increased all over. We see the same happening in and out and within Africa. Demand is up and continues to increase, especially into Southern Africa. Then there is still the traditional northbound loads ex-Kenya, which will increase again. We also see more project and mining business happening again and expect that these industries will recover further in the coming weeks,” revealed Reto Hunziker, group cargo and OBC sales director, Chapman Freeborn.

“The pandemic has led to an increase in cargo business and Ethiopian has boosted its cargo capacity converting about 25 passenger planes into cargo aircraft. The African air charter operation has increased significantly while the usual cargo volumes have declined post-Covid,” said Fitsum Abady, head of cargo, Ethiopian Cargo.

The demand on cargo charters increased all over. We see the same happening in and out and within Africa. Demand is up and continues to increase, especially into Southern Africa. Then there is still the traditional northbound loads ex-Kenya, which will increase again.

Reto Hunziker, Chapman Freeborn

Recently, DSV introduced three new intercontinental routes connecting five continents including Africa to accommodate customer demands in a global air freight market affected by lack of capacity due to the Covid-19 pandemic. Among the three routes is Luxembourg – Johannesburg (roundtrip), South Africa starting April 1, 2021. DSV will have four weekly direct rotations with a combined 150 tonnes of capacity connecting two DSV hotspots in Europe and South Africa.

Responding to flower power

Amidst the pandemic and the preparations for the distribution of the Covid-19 vaccines, the flower peak season, which starts with Valentine's Day in February, followed by Women's Day and Mother's Day, witnessed strong export orders for flowers from Africa. Currently, the production of flowers on Kenyan farms has hit 90 percent of pre-Covid-19 levels as countries in the export market reopen their economies, according to a survey by the Monetary Policy Committee of the Central Bank of Kenya (CBK) released in February 2021. "Following the re-opening of the economies, production has improved on account of increased cargo space after resumption of flights to key export markets," said the CBK. "Exports have recovered to 95 percent of pre-Covid-19 levels, from 53 percent in April 2020 following low demand due to lockdowns in Europe, and unavailability of cargo space and high cargo space costs," said the bank. Around 3,000 tonnes of flowers are currently exported every week from Nairobi's Jomo Kenyatta International Airport.

“The charters will remain operating on critical flower peak seasons. This year, we had Valentine’s Day charters and are now running the International Women’s Day and UK Mother's Day charters. We expect the International Mother's Day charters later in May. The volumes have been volatile due to buyer market lockdowns which tamed demand. However we do expect a growth of approximate 5-7 per cent this year,” said Peter Musola, cargo commercial manager, Kenya Airways Cargo.

The Kenyan airline adapted a passenger Boeing 787 Dreamliner to start carrying cargo, and help meet more flower orders. The conversion and increased flight frequencies will add as much as 40 per cent capacity.

The government, which owns 49 per cent of Kenya Airways, allowed the carrier’s competitor to deploy additional freighters on the Nairobi-Amsterdam route to ease capacity constraints. Kenya is Europe’s biggest supplier of cut flowers, which are one of its biggest foreign-exchange earners. “As long as we have fresh produce which needs to be airlifted, we will continue licensing even foreign aircraft because what is most important is to have aircraft carrying produce from here,” Kenyan Transport Secretary James Macharia said in a statement. “It is secondary whether it is Kenya Airways or any other airline.”

However, charter specialist Chapman Freeborn had a different story to say regarding the movement of flowers via air charters from Kenya. “The market decreased due to Covid-19 like most other markets as well. Also, lot of carriers pulled out ex-Kenya to redeploy their aircraft on routes with higher demand. In the long-run, we expect that this gets back to the stage as it was before Covid-19 started, however, this will take a while,” said Hunziker.

Meanwhile, Africa's largest carrier Ethiopian has operated daily flights during the Valentine period including passenger-to-cargo aircraft to support the growing perishable exports. Ethiopian Cargo and Logistics Services have transported 95,833,333 million stems of flowers from Nairobi and Addis Ababa in two weeks’ time for Valentine’s season. The airline has shipped 1,600 tonnes from Nairobi and 3,000 tonnes from Addis Ababa to Belgium, Cote d’Ivoire, Germany, Italy, UAE, US, South Korea, Saudi Arabia, South Africa and many more destinations through its vast global network.

Sanjeev Gadhia, the CEO of Astral Aviation, a Nairobi-based cargo airline said that it has doubled its cargo services to Europe for the two weeks leading up to Valentine’s Day. Moreover, the carrier is introducing new flower shipments to the likes of Saudi Arabia and Dubai.

Understanding the demand for perishables from Kenya, Astral Aviation acquired a B767-200F from Air Transport Services Group in October 2020. Astral Aviation has deployed the freighter on the Nairobi-Sharjah route from February 2021, creating the capacity for 80 tonnes per week of flowers and vegetables to the UAE. Astral has also upgraded the B767-200F on its Nairobi-Johannesburg route, increasing the total capacity to 160 tonnes per week to South Africa. The freighter will also offer capacity on high-priority for the distribution of the Covid-19 vaccine to and within Africa in addition to humanitarian cargo. Gadhia also said that the freighter will complement the existing fleet by providing new opportunities in the 40-tonnes category which was previously underserved in Africa. The B767F is ideal for Astral’s intra-African network, which comprises 15 scheduled destinations while offering new opportunities to the Middle East, which is an important gateway for East Africa’s air imports and exports.

The volumes have been volatile due to buyer market lockdowns which tamed demand. However, we do expect a growth of approximate 5-7 per cent this year.

Peter Musola, Kenya Airways Cargo

Call of duty: Covid-19 vaccine distribution

In December 2020, UNICEF and the World Economic Forum (WEF) have signed a charter with 18 shipping, airlines and logistics companies to deliver the vaccine globally, in support of the COVAX Facility – the global effort aimed at equitable access to COVID-19 vaccines. Of the African carriers, Ethiopian Airlines and Astral Aviation have signed the pact to prioritise the transport of the life-saving supplies, ensuring measures such as temperature control and security and adding freight capacity to routes where needed.

“We will be placing our entire fleet of B747F, B767F, B727F, DC9F, CRJ-200, Fokker 50 and Fokker 27 on high priority, which is critical to the timely and secure delivery of vaccines and critical supplies, as we consider it our moral-obligation to ensure that no person in Africa is left-behind due to lack of aircraft capacity,” stated Astral Aviation’s Gadhia.

Ethiopian expects significant traffic to different African countries, which will give it the opportunity to reclaim its role in fighting the pandemic in the continent.

“We have made all the necessary preparations to make use of our modern freighter & belly hold fleet and the largest and well equipped cargo facility. Our facility has a capacity to carry more than 1-million-tonne annually more than 56 percent of which is dedicated for cold chain facility. Besides, our connectivity, freighter network as well as the geographical location of our main hub at Addis Ababa give us a competitive advantage for the transportation of much needed vaccines and other medical equipment,” said Ethiopian Cargo’s Abady.

The first 600,000 doses of COVAX vaccines arrived in Africa on February 24 at Kotoka International Airport, in Accra. The first of at least 2 billion doses to be supplied by COVAX in 2021, these doses of the Oxford-AstraZeneca vaccine were flown in overnight from India where they were manufactured by the Serum Institute of India via Emirates SkyCargo, using an Emirates 777-300ER passenger freighter.

While huge volumes of vaccines will probably fly on belly aircraft into the main hubs and be re-distributed from there, charters with smaller kind of aircraft might happen to reach the remote places that cannot be reached by most of the carriers. Commenting on Chapman Freeborn’s preparedness for the vaccine transportation to hard-to-reach regions, Hunziker said, “We are constantly monitoring the situation and are in contact with the customers and the supplier side. We have a year-long experience and know-how in Africa and are therefore we are well positioned and prepared for potential vaccine shipments.”

We have made all the necessary preparations to make use of our modern freighter and belly hold fleet and the largest and well equipped cargo facility (for Covid-19 vaccine transportation)

Fitsum Abady, Ethiopian Cargo

Going forward, industry experts feel the potential for cargo charters remain high as long as the passenger capacity isn't back. “With IATA projecting full recovery of passenger demand in 2023, the charter opportunities will proportionately decline up until this transitional period,” said Musola.

“Africa was and will always be important for Chapman Freeborn. We see some great potential on intra-Africa chartering. The traditional EU-RSA traffic will continue on high level with seasonal fluctuations. The same will happen ex Kenya. There will also be more demand ex North Africa into EU, mainly driven by the automotive industry. Last but not the least, we also see an increase in demand for intra-African project and O&G business,” Hunziker added.