Air Cargo Continues Decline

I just read the most recent press release from IATA regarding cargo traffic for the month of August and freight volumes continued on a downward trend. Freight volumes for August were down for the third consecutive month in a row posting a 2.7% drop in global freight traffic. The alarming trend to me is that the 2.7% drop was larger than July’s 1.9% and June’s 0.8% decline. With the state of the U.S. and global economies, I would not be surprised to see this negative trend continue.

Via IATA’s press release:

“The industry crisis is deepening and no region is immune. Urgent measures are needed. From taxation to charges and operational efficiencies, all areas impacting the business must be examined for ways to reduce costs and drive efficiencies. It’s a matter of survival,” said Bisignani.

Asia Pacific carriers led the way with a 6.8% decline in August

JAL to reduce freighter service to the U.S.

Due to the weakening US economy, Japan Airlines has announced that they will reduce freighter service to/from NRT to the US.

Specifically, JAL announced that beginning in January 2009, they will suspend freighter service to New York and reduce freighter flight frequency from 6 to 5 flights per week on the NRT – LAX route.

Via JAL.com:

In order to build a more profitable business structure, the airline will concentrate its freighter resources on just two destinations in North America: Chicago and Los Angeles. By concentrating on fewer freighter destinations in North America and adjusting demand and supply, JAL aims to speedily respond to changes in the business environment and further improve profitability.

The airline is currently facing a tough environment, particularly in terms of its North American freighter business. Even though the price of fuel has stabilized, it has remained at a very high level. Furthermore, the business outlook, centering on North America, remains gloomy.

National Container Fee

Just read on joc.com that new proposed legislation drawn up by Laura Richardson, D-Calif., would impose a $25 per TEU fee for all containerized imports.

The bill entitled “Making Opportunities Via Efficient and More Effective National Transportation Act of 2008″, would directly affect beneficial cargo owners. Supposedly, proceeds from the container fee would go towards security and environmental projects.

Swizstick has kept us up to date on many of the recent legislative issues especially those pertaining to the ports in Southern California, but this is the first potential legislation that I have seen that would have a nationwide effect on containerized imports.

Japan: August export growth slows to 0.3%

Weak demand from the U.S. and Europe is taking it’s toll on Japan’s exports:

Japan had a trade deficit of 324 billion yen ($3 billion), the first since January, because of record oil imports. The nation’s import bill rose 17 percent from a year earlier.

Shipments to the U.S. plunged 21.8 percent last month, the biggest decline on record, and exports to Europe fell 3.5 percent, today’s report said. Weak overseas demand caused the economy to shrink an annualized 3 percent last quarter.

Cut Production

Since August, some of Japan’s biggest manufacturers have lowered sales targets and announced cost-cutting measures that could start to take a toll on smaller companies that supply them.

All-in-all, not good news for Japan or the world economy.

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