Limited capacity pushes up Africa rates

Airfreight volumes into Africa are on the increase, says Mike Todd, vice president for Africa of wholesale airfreight consolidator AMI. There are, however, large rate differences between East and West Africa and that is all about airline capacity into the regions. “A large portion of the West Africa demand is mining equipment which tends to absorb the higher freight costs. The rates into West Africa can be ten times higher than to long-haul destinations such as New York or Europe which highlights the excess export capacity into these destinations,” he told FTW. “It is very much a demand versus supply scenario at present. If you want your goods moved then you have to pay the rate. Where there is excess capacity, the competition is driving rates down to other destinations such as the Americas, Europe and Far East.” Todd said that while many airlines had done a fair amount of development in accessing African destinations, the freight capacity was limited and was often determined by passenger flights. “We do see more freighter operators coming into the Africa market, attracted by the growth and the good yields,” he said. “We handle cross-trade traffic into Africa and we see growth there too, particularly from our China office,” said Todd. “Increased Africa trade has been assisted by reforms put in place, making it easier to do business in Africa and with more secured banking.” He said destinations such as Lagos, Entebbe, Dar es Salaam and Accra in particular continued to see an increase in freight volumes, with a lot of mining equipment and commercial goods being transported. “What is very positive to note is that Africa has not increased because Europe has decreased but is a developing market in its own right. International organisations are predicting Africa growth rates of 5- 6% for the next few years,” he said. “It is an area of our business on which we have placed much emphasis and we have built good relationships with several airlines servicing Africa, enabling us to offer very competitive rates to our clients.” INSERT & CAPTION Africa has not increased because Europe has decreased but is a developing market in its own right. – Mike Todd