Regional Pulse: Malaysia sees reduced demand amid growing cargo activity

Malaysia is experiencing a slight reduction in demand like other parts of the region, but stakeholders are continuing to invest in cargo operations to service the area’s overall growth in airfreight activity. Malaysian exports specifically are still booming, Ong Chin Kian, director and co-founder of Malaysia-based forwarder Transcargo Worldwide, told Air Cargo World. The forwarder saw a 42% increase in the first eight months of 2022 compared with the same period in 2021 due to manufacturing and e-commerce goods, he added. Most cargo is being shipped via passenger belly capacity, with freighters helping to create additional capacity. However, like other parts of Asia-Pacific, forwarders are seeing lower customer demand. In turn, Ong Chin anticipates that there will “no peak season in the last quarter of the year since the demand seems to be reducing worldwide .” [caption id="attachment_57132354" align="alignright" width="455"] Photo/My Indo Airlines[/caption] “Airfreight rates will be dropping further in the next few months since most of the airlines [will] resume more flights soon,” he told Air Cargo World . However, Transcargo secured contracts with its regular customers to ensure that the impact of the increasingly slack demand will be “relatively small since we have guaranteed volumes from our customers.” In 2021 freight forwarders with operations in Malaysia reported tight belly capacity and high airfreight rates . However, that isn’t the case this year. “We see more airlines [resuming] their passenger flights so belly space is [growing] compared with six months ago, and rates have dropped dramatically as well,” Ong Chin said. In turn, capacity is more readily available and easier to obtain since the start of the year. Current in-demand routes include Malaysia-Hong Kong (HKG), the Indian subcontinent and the U.S. East Coast, he added. Warehouse investments Cargo stakeholders continue to invest in warehouse infrastructure to meet demand. Transcargo set up a 40,000-square-foot warehouse in Johor — near Singapore — roughly two months ago to meet “urgent customer demand,” Ong Chin said. But plans last year to build facilities at Pulau Indah Industrial Park have been stalled due to a shortage of workers and the high cost of building materials in Malaysia. In April, Nippon Express Malaysia opened a 5,896-square-meter warehouse at Kuala Lumpur International Airport (KUL). In 2021 KUL saw a 25.2% year-over-year increase in tonnage , reporting roughly 652,596 tonnes of cargo. The rise in Indonesian cargo carriers In nearby Indonesia, local carriers continue to build out their freighter operations amid the country’s cargo boom. In fact, East Asian market growth, in part driven by surging e-commerce demand, is one of the key drivers for new freighter aircraft over the next 20 years , according to Boeing’s Commercial Market Outlook 2022-2041 published in July. By 2041, Southeast Asia will receive 35 freighter deliveries while South Asia will receive five, making the region’s freighter fleet nearly the same size as North America’s. Iceland-based Bluebird Nordic parent BBN Cargo Airlines Holdings established its startup BBN Airlines Indonesia in September after considering Southeast Asian expansion for quite some time. As an ACMI and charter specialist, BBN Airlines Indonesia will operate a planned fleet of 737-400Fs, 737-800Fs and A320 Family freighters, with A330Fs planned. The new carrier will first serve Indonesia’s domestic market before implementing destinations including Singapore (SIN), Bangkok (BKK), Kuala Lumpur (KUL), India and Australia. “Indonesia is a huge country which is divided into a lot of different islands, so for cargo, I think that there are very good opportunities either locally or in Southeast Asia because you can also fly to the other countries, [as] the traffic rights allow this," Audrone Keinyte, CEO of Bluebird Nordic and BBN Cargo Airlines Holdings, told Air Cargo World . BBN Airlines Indonesia is just the latest in a list of other operators building freighter fleets. Indonesia-based Rimbum Air, for instance, recently took delivery of a 737-800F and plans to continue operating its 737-300Fs as well as more aircraft next year, as reported by Air Cargo World ’s sister publication Cargo Facts . In June Menzies Aviation secured a three-year contract to handle six daily cargo flights on behalf of Rimbun Air. My Indo Airlines will be the first to fly a 737-800 freighter in the country while Black Stone Airlines, a new Indonesian airline that obtained its air operator certificate in December 2021, also began operations earlier this year with a 737-300F .

Regional Pulse: Malaysia sees reduced demand amid growing cargo activity

Indonesian carriers build up freighter ops

Listen: A week of firsts for manufacturers and STC holders

Register now for Air Cargo World’s webinar on dangerous goods

Related Posts

NTSB analyzes flight crew decision-making in 21 Air crash

Yamato, Spring Japan to end A321F operations in 2027

Retaliatory tariffs hit US imports into Canada

Register now for Air Cargo World’s webinar on dangerous goods

Cargo Facts Free Newsletters

Cargo Facts Connect Podcast

Follow Us

Welcome Back!

Retrieve your password