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HK premium for cargo backlog

The volcanic ash cloud that crippled European aviation is proving to have a silver lining for Hong Kong carriers with desperate exporters paying a hefty premium to clear a mountain of backed up cargo.

Cathay Pacific, DHL and UPS have raised freight rates to Europe three- or fourfold to about $12.89 per kg to move everything from electronic goods to high fashion.
 
Sunny Ho Lap-kee, executive director of the Hong Kong Shippers’ Council, said some exporters had earlier shifted to shipping their cargo by sea to avoid having to pay compensation for late delivery, "We can either accept the price or use the Silk Road trade lane like our ancestors." 
 
Cathay, the city’s largest freight operator has now returned to 100% capacity.


Freight rates to Europe have risen to $12.89/kg from less than $3.86/kg before the European airports closed.
 
CargoNews Asia reports airline executives said the rise in rates was driven mainly by genuine demand and supply as well as losses incurred in the grounding of aircraft. Other have used harsher words.
 

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