Asia-Pacific’s cargo hubs: Delivering the goods
Editor, Joe Bates, reports on the 2020 performance of the region’s leading cargo hubs and the key role they are playing in helping distribute the COVID-19 vaccine.
In terms of volumes and payloads, air cargo fared much better than the passenger side of the business in 2020, and that seems likely to be repeated for most or all of this year as COVID-19 continues to wreak havoc with people’s travel plans.
Indeed, while the combination of travel restrictions, quarantine rules, the fear of catching COVID-19 and reduced airline services are keeping passengers away from airport terminals, cargo volumes have rallied and demand for some shipments has never been higher.
Months of shop closures and being forced to stay at home, for example, has led to a boom in e-commerce and arguably companies like Amazon and Alibaba have never been so busy.
While aircraft continue to bring vital Personal Protective Equipment (PPE), medical supplies and now vaccines to countries across the globe as efforts are ramped up to finally win the war against COVID-19.
The upturn in these consignments, in addition to the continued need for more traditional cargos flown across the region on freighters and in the belly-holds of passenger flights, means that some of the Asia-Pacific region’s biggest cargo hubs reported an upturn in volumes in 2020.
These included Shanghai Pudong (PVG), the third busiest cargo hub on the planet, which saw its cargo volumes rise by 1.37% to 3.68 million tonnes and Taipei Taoyuan (TPE), which handled a record 2.34 million tonnes of freight (+7.35%) to cement its Top 10 status.
ACI World’s provisional traffic data for 2020 also shows that Incheon International Airport (INC) enjoyed a positive year for cargo movements with its annual tonnage numbers rising by 2.1% to 2.82 million.
And Ted Stevens Anchorage International Airport (ANC), an ACI Asia-Pacific affiliated member, consolidated its Top 10 ranking courtesy of the 3.1 million tonnes (+16%) to pass through its facilities in 2020. You can read more about its impressive performance and plans to enhance its cargo operations on page 28 of this issue.
Taipei Taoyuan reveals that transhipment cargo soared by 19% last year to account for 51% of all freight handled at TPE. The upturn, it says, reflected the “noticeable performance of industries” in Chinese Taipei.
The increase was also helped by the sizeable cargo fleets of TPE’s two home carriers, China Airlines and Eva Air, which the airport note prevented it from being “greatly challenged by the declining passenger traffic”.
The USA (32%) and Mainland China (15%) traditionally account for the bulk of transhipments at TPE, and both enjoyed robust growth in 2020, with volumes rising by 25.2% and 8.5% respectively compared with 2019. The upturn, says TPE, reflected the strong demand for technology products made in Chinese Taipei and Asia, such as semiconductors and consumer electronics.
President and CEO of Taoyuan International Airport Corp, Jerry Dann, believes that the airport’s performance in 2020 showed the world how TPE was able to take maximum advantage of its key advantages – its location, route network and transportation facilities.
Thinking about the future, he said: “Now, in pursuit of excellence, TPE is following the Taoyuan International Airport Conceptual Plan, approved by the government in early 2021, to arrange the new cargo park and the second Free Trade Zone, upgrading the cargo industry to the next level by improving efficiency and implementing innovative technologies.”
Other airports across the region, however, didn’t do quite so well as the reduction in passenger flights and the loss of the hundreds of thousands of tonnes of cargo they accommodate onboard each year meant that 50% of Asia-Pacific’s Top 10 busiest cargo airports experienced a downturn in volumes last year.
They included Hong Kong (HKG) and Dubai International (DXB), which have announced that their cargo volumes dipped by 7% to 4.47 million tonnes and 23% to 1.9 million tonnes respectively in 2020.
The downturn at HKG, and a 6.72% upturn in volumes at Memphis (MEM) – home to FedEx’s world hub – means that for the first time in a decade the US airport has replaced Hong Kong as the busiest cargo gateway on earth.
Despite the drop, the Airport Authority of Hong Kong (AAHK) is quick to point out that HKG recorded an 18% rise in all-cargo flights during 2020 and that “cargo imports and exports continued their strong growth in, climbing by 18% and 8% year-on-year, respectively” in the final month of the year.
Describing 2020 as a “relatively stable” year for cargo, the airport operator noted that transhipments “decreased significantly due to the shortage of belly capacity on passenger flights”.
ACI’s provisional cargo figures for 2020 also indicate that Hamad (DOH), Tokyo Narita (NRT), Singapore Changi (SIN) and Guangzhou Baiyun (CAN) all experienced a tough year and an annual fall in tonnage.
Out of them, Qatar’s Hamad International Airport fared best, based on its 1.8% drop in volumes, and Singapore Changi the worst because of a 23% decline in cargo tonnage compared to 2019. However, the 1.54 million tonnes of freight handled at SIN during 2020 meant that it is the 17th busiest cargo hub in the world and the ninth biggest in Asia-Pacific.
Overall, air cargo volumes across both Asia-Pacific and the world decreased by 12.2% in 2020, with ACI’s preliminary data revealing that around 105 million tonnes of freight was handled globally and 39.1 million in the APAC region.
There is, of course, no getting away from the fact that 2020 was a bad one for aviation, and IATA has pulled no punches in calling it a “catastrophe” for passenger traffic and the worst for air cargo since it began monitoring the cargo performance of airlines in 1990.
According to IATA, global demand measured by cargo tonne-kilometres (CTKs) fell by 10.6% in 2020 while global capacity in available cargo tonne-kilometres (ACTKs) plummeted by 24% compared to 2019.
Nevertheless, there are some grounds for optimism as it recently revealed that global cargo demand returned to pre-COVID levels for the first time in a year when CTKs in January 2021 were 1.1% above those reported in January 2019.
The news prompted IATA director general and CEO, Alexandre de Juniac, to comment: “Air cargo traffic is back to pre-crisis levels and that is some much-needed good news for the global economy.
“But while there is a strong demand to ship goods, our ability is capped by the shortage of belly capacity normally provided by passenger aircraft. That should be a sign to governments that they need to share their plans for a restart so that the industry has clarity in terms of how soon more capacity can be brought online.
“In normal times, a third of world trade by value moves by air. This high value commerce is vital to helping restore COVID damaged economies – not to mention the critical role air cargo is playing in distributing lifesaving vaccines that must continue for the foreseeable future.”
Pre-COVID, IATA’s often repeated mantra was that airlines transport over 52 million tonnes of goods a year, representing more than 35% of global trade by value but less than 1% of world trade by volume. That is equivalent to $6.8 trillion worth of goods annually or $18.6 billion worth of goods every day.
It waits to be seen how long it will take for cargo volumes to return to and eventually surpass those kind of levels, although the signs are good that the bounce back has already started.
For the record and based on a combination of airport figures and preliminary 2020 data from ACI World, Asia-Pacific airports currently account for five of the top 10 busiest cargo airports in the world.
Medical supplies and COVID-19 vaccines
Air cargo has played a major role in the battle against the pandemic by providing the quickest, safest and most reliable way of transporting vital medical supplies, PPE and now COVID-19 vaccines across the world.
To assist in this process, in recent months Dubai Airports – operator of Dubai International (DXB) and Dubai World Central (DWC) – and Hyderabad’s Rajiv Gandhi International Airport (HYD) have joined forces to create a COVID-19 vaccine distribution corridor capable of handling up to 300 tonnes of vaccines per day.
The HYD-DXB vaccine corridor connects major vaccine manufacturers in India with markets around the world via Dubai’s state-of-the-art cargo hub.
“This corridor is the result of our proactive strategy to be ready with innovative, collaborative and agile shipping solutions for the industry,” said Paul Griffiths, CEO of Dubai Airports.
GMR Airports executive director – south & chief innovation officer, SGK Kishore, enthused: “As the world embarks on an unprecedented vaccination drive to combat COVID-19, our collaboration with Dubai Airports in the form of an exclusive vaccine air freight corridor will play a key role in enabling seamless, safe and efficient shipment of COVID-19 vaccines to and from Hyderabad, the pharma capital of South Asia.”
Dubai has also launched the Vaccine Logistics Alliance to speed up distribution of COVID-19 vaccines around the world through the emirate.
Elsewhere, HKG continues to play a prominent role in the global distribution of COVID-19 vaccines, most recently handling the first batch of Comirnaty vaccines to arrive in Hong Kong from Frankfurt and shipping more supplies from Beijing to Mexico.
While in Singapore, the Changi Ready Taskforce, co-led by the Civil Aviation Authority of Singapore (CAAS) and Changi Airport Group (CAG), declared Changi ready for the transportation and distribution of COVID-19 vaccines in late 2020.
CAG’s managing director for air hub development and co-lead of the Changi Ready Taskforce, Lim Ching Kiat, said: “Changi has always placed a strong emphasis on pursuing the highest standards in pharmaceutical cargo handling. Given our efforts in infrastructure upgrades and manpower training over the years, our air cargo hub is well-poised to handle the transportation of COVID-19 vaccines”.