The global airline trade body Iata estimates that the Coronavirus crisis could cost the airfreight industry up to US$113m in lost revenue. This estimate might need to be revised following the recent ban imposed by the US on flights to and from Europe which is likely to significantly cut capacity send rates soaring for the transportation of perishables. When a similar ban was imposed on flights from China in February, there was a 27% rise in airfreight rates between February 24 and March 9, according to the TAC Index. Flight capacity was reduced by over a third.
While cargo-only flights are not subject to the restrictions, most of the airfreight trade between Europe and the US is with passenger aircrafts. In fact, over 60% of the airfreight between Europe and the US is on passenger flights, according to cargo data provider WorldACD,.
The drop in capacity is likely to have a knock-on effect across the globe. Speaking to Fruitnet, Ole Schack Petersen, senior vice-president and chief strategy officer at LCL and Broom Group said, “With fewer planes in the air, it will also affect China-Europe routes. Some fresh produce will have to move ocean freight where possible.” This might lead to more perishables being sent via the UK, which is not subject to the restrictions.