China airfreight rates fluctuate dramatically

Recognising the massive
growth potential on the
China-South Africa route,
the airfreight division of
independent consolidator
CFR Freight has launched an
aggressive drive to expand
its share of the market.
Evidence of this was
the arrival in South
Africa earlier this month
of managing director of
Far East agent NAC Asia,
Christos Spyrou, who is also
chairman of the company’s
international agency
network, the Air Cargo
Group, of which CFR is a
board member.
Spyrou was in South
Africa for a week-long sales
visit to Johannesburg, Cape
Town and Durban.
CFR currently offers
airfreight services out of
12 Chinese origins – and
NAC has offices in all of
those origin cities, general
manager – airfreight, Dave
Graham, told FTW.
It’s a true supply and
demand market, says
Graham, with capacity
tending to be almost a
commodity and rates
fluctuating dramatically. SA
importers don’t understand
the concept of rates
fluctuating on a daily or
weekly basis but that’s what
we deal with. The Chinese
tend to be very focused on
their big export markets –
being Europe and the US –
and don’t understand the SA
market need for rate stability.
“For us we’re in the
fortunate position of having
a very good agent with a
good line of communication.
We try to tackle new
business in a two-pronged
manner. We target the
importer on this side and
will put NAC in contact with
the exporting forwarder on
the other side, a system that
tends to work very well.
“We believe it’s vital that
both sides are talking to
each other and talking the
same language.”
An additional advantage is
NAC’s capacity agreements
with preferred carriers in
Asia, says Graham.
“Although the lane is
extremely prone to capacity
shortages we hold our own
because of these capacity
agreements that are able to
see us through peak demand
like the World Cup.”
According to Graham the
Chinese route has shown
better signs of stabilising in
the past few months than the
likes of Europe and the US.
“China was very heavily
hit by the volcano because
a lot of cargo is transhipped
in Europe. It was also
massively impacted by
the World Cup because
everything from soccer
jerseys to plastic toys was
coming out of China. But
China was also the origin
that seemed to recover first
– just in time for the start of
the traditional year-end peak
season.
“In a nutshell, it’s a lane
in which we are investing,
in which NAC is investing
and where we expect to see
significant growth in the
year ahead.”