April brings cascade of airfreight surcharges from COVID, war disruptions

Rising fuel prices, long-haul flight rerouting and new COVID-19 shutdowns and flight cancellations prompted carriers to increase surcharges on air cargo shipments in late March and early April. [caption id="attachment_91966" align="alignright" width="450"] Shell Aviation into-plane refueling operations at Singapore Changi Airport, 2014. Photo courtesy of Shell.[/caption] Jet fuel prices increased in March following the late February invasion of Ukraine by Russia, following higher and more volatile crude oil prices, according to analysis from the U.S. Energy Information Administration (EIA). Daily spot prices for jet fuel at the U.S. Gulf Coast averaged about $3.43/gallon according to EIA data, more than twice the March 2021 average and representing a month-over-month increase of 28%. The closure of Ukrainian airspace to civilian traffic and select bans by Russia on foreign carriers in its own airspace also forced many carriers to either cancel long-haul routes or divert around the airspace in question. While some carriers, including Japan Airlines Cargo and Cargolux, responded quickly to increase fuel surcharges or institute war surcharges in late February and early March, many more have since followed suit during the latter half of March and in early April. Among those carriers instituting or increasing surcharges in the second half of March were Atlas Air, CAL Cargo Airlines, China Airlines Cargo, DHL, Ethiopian, LATAM Cargo, Lufthansa, Singapore Airlines and Swiss WorldCargo, according to carrier notices and a collection of carrier impact updates published by freight forwarder AIT Worldwide Logistics. So far in April, Asiana, Cathay Pacific, Cargolux, China Airlines, Delta, Korean Airlines and Polar Air Cargo further increased or newly instituted additional surcharges. Cargolux adjusted its surcharge in euros to €1.20/kg, with USD remaining at $1.25/kg, and another increase scheduled for April 11 at €1.30/kg and $1.40/kg. Air China Cargo is adjusting its fuel surcharge to $0.97/kg as of April 16. More disruption of airfreight operations is expected in the weeks ahead. COVID-19 outbreaks in China that led to flight cancellations beginning in late March were expected to be contained by early April, but lockdowns in Shanghai have since been extended indefinitely , according to freight forwarders. The Air Cargo Tech Summit, the new airfreight logistics event presented by Air Cargo World , will take place live in Miami from June 6-7. Learn more and register here.

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