Gustavo Mundel of PML looks at how Brexit and the pandemic are impacting the sector

The airfreight sector has shown significant growth in recent years with global airfreight volumes reaching 61.3m tonnes in 2019 (source: Statista 2020). 

Two dominant factors can be identified which have led to the clear increased demand for air transportation services capable of transferring commercial goods. The meteoric rise of e-commerce and the ability to purchase products from all over the world simply by the click of a button has stimulated a dramatic interest in delivery services that can provide a means of speedy fulfilment, to match consumer expectations.

In addition to this, while airline fuel prices reached an all-time high in 2012 which attributed to slow growth in air freight volumes, the notable fall in the cost of airline fuel in 2016 resulted in clear evidence of a growth in airfreight volume.

Benefits of airfreight

For a company involved in the transportation of temperature-sensitive, perishable goods, the advantages of moving consignments via airfreight lanes are clear. Firstly, the sheer speed of transit – air travel is by far the fastest mode of transport and hence, for products which have a finite shelf-life, the opportunity to maximise the length of time during which the goods can remain on sale in store, is critical. The difference between moving goods by air or sea can represent an extended shelf-life of up to 48 hours.

In addition, flights to destinations all over the world (under normal conditions), are frequent, providing a much wider window of opportunity to book in the expeditious transfer of cargo.

Finally, given the much-debated impact of Brexit, air travel provides the ability to transcend border delays and while the pandemic obviously has had a major impact on passenger numbers, airports largely have been able to remain operational and have been able to continue providing a much-needed service to maintain the supply of essential goods – including PPE – around the world.

Competitive charters

Within the specific chartered air freight sector competition is fierce. There are a number of carriers now offering their services directly rather than via a charter broker and in some ways, these airlines are starting to operate as logistics providers in their own right.

From merely selling space on the aircraft, they are increasingly offering a complete one-stop shop to secure business and ensure flights are filled to maximum capacity.

Although passenger traffic has been seriously compromised by the global outbreak of coronavirus, many of the airlines have been quick to seize the opportunity to retrofit aircraft to enable them to operate as cargo carriers providing the ability to continue flying at improved capacity.

Trends for 2021

But what does the future hold for chartered airfreight services? There is no sign of any slow-down in the world of e-commerce, in fact quite the opposite. With so many consumers forced to adapt their shopping habits in response to the restrictions imposed as a result of Covid-19, it is likely that the changes that have been made will be long lasting.

While the world remains optimistic that the traditional retailers will be able to resume normal trading, the fact is that consumers will have become accustomed to revising their approach to purchasing and will be loathed to turn their back on the speedy digital shopping experience.

In response to this, more and more aircraft are being reconfigured to carry cargo, rather than passengers and there has been a spike in the number of aircraft retrofit businesses able to undertake these specialist works.

Since the production of the Boeing 747 has stopped in favour of the more fuel efficient, newer 777, so interest in the procurement of 777s to lease or buy has increased and while some of these may already be converted for cargo, we are likely to see more of these passenger aircraft configured to accommodate the exclusive handling of cargo. 

The world of e-commerce traditionally focuses on a high proportion of goods being transported out of China into major European hubs. As a result, there is likely to be a predicted growth in the number of chartered airfreight services transferring consignments out of these hubs and delivering them to local European markets. This means that once again, the pressure for space will be intensified on these flights.

Given the world’s growing mandate to address the need to slow down climate change, it is also likely that the future will bring new breakthroughs in fuel efficient engines which represent an improved carbon emissions proposition. 

For companies who trade on their ‘green’ credentials, this will enable them to potentially reconsider the use of chartered aircraft, which will in turn create further demand for space.

Impact of Brexit

Brexit has effectively provided a massive boost to the chartered airfreight industry. Companies which specialise in perishable goods cannot risk being caught up in cross-border delays, delays which can have a devastating impact on time-sensitive produce.  UK supermarkets and independents demand quality fresh produce, with a good shelf-life.

Goods that have been kept in transit when they should have been on the shelves will have a reduced shelf-life triggering substantial losses to the producer. 

For PML, the speed of transit associated with chartered aircraft services, supported by the company’s ability to handle product with an unbroken cold chain thanks to its unique relationship with Heathrow’s only dedicated chilled airside facility, has dictated an even stronger interest in chartered air freight in the wake of Brexit. Such is the demand that PML, has seized the initiative to charter its own aircraft to ensure the seamless and timely transfer of fresh produce.

Coronavirus crisis

The impact of the global pandemic continues to be felt in all sectors of industry and the chartered airfreight sector is certainly not exempt. As countries begin to prepare for massive vaccination programmes the priority for many airlines is to capitalise on the opportunity to carry the vaccines and as a result the race for space on chartered flights continues to heat up.

Competition for space in turn brings with it spiralling prices. Now the charters are becoming even more expensive due to the potential to charge a premium price for the transportation of PPE and vaccines.

Looking ahead

As the biggest independent perishable goods importer, PML continues to work hard to stay ahead of the curve. In addition to chartering its own twice-weekly flight from Nairobi to Heathrow, the company is watching the market to identify new opportunities to increase the number of flight rotations operated by PML and its partner network.

Having an in-house air charter service division, headed up by someone who has acted on both sides of the fence, working for an airline as well as an independent charter broker means that the company is well placed to access the very best air trade lanes. But as anyone in the logistics business will testify, these will be challenging times for the industry.

Source: Fruitnet.com

Inside PML’s purpose built Border Control Post and DEFRA inspection area

Keeping imported products fresh, clearing customs, DEFRA compliance and a faster route to market, let’s head inside the world of expert logistics and freight movement company Perishable Movements Limited.

It’s been a busy few months, but we’re delighted with our new purpose build Border Control Post (BCP) and DEFRA inspection facility which will keep our clients’ produce fresher for longer and speed up its route to market.

Fully kitted out with scales, magnifying lamps and washing areas, the DEFRA inspection area is completely compliant with UK import customs regulations. It is also set-up to ensure that Covid-19 guidelines as outlined by Public Health England and the UK Government are fully implemented. This includes measures to ensure social distancing can be adhered to by DEFRA inspectors and PML employees. The facility is also cleaned down and sanitised after every inspection.

Inside the Spalding located main warehouse and customs bonded area, you will find a fully approved HM Customs Border Control Post. With the opening of this facility in early November 2020, PML Ltd are able to hold large amounts of uncleared product from the multiple containers and vehicles that arrive at the site throughout the day.

Within the temperature controlled facility, purpose-built equipment such as racking systems are installed to increase capacity for both product awaiting inspection and for product that has passed through the DEFRA inspection area. All produce is kept at the optimum temperature for fresh goods of between 2-4 °C. Any produce that has failed the DEFRA inspection process is stored separately, well away from the other products in the warehouse.

What happens to the produce that fails the DEFRA inspection? As part of PML’s commitment to environmental sustainability and pledge to reduce wastage, all produce that fails DEFRA inspection is taken to an Anaerobic Digestion plant where it is turned into methane to generate electricity.

Want to know how PML can help streamline your freight movement of fresh produce and speed up your perishable goods route to market?

Get in touch:

+44 (0)20 8893 2666 or quotations@pml-ltd.com

PML announces innovative solution to border control delays

PML, the global perishable cargo specialist is partnering with transport and logistics company FreshLinc to operate an HMRC / DEFRA approved Border Control Post (BCP) and ERT (bonded warehouse) facility at Fresh Linc’s Spalding HQ, enabling a speedier movement of product from the ports and extending shelf life by up to 48 hours.

The BCP which has been in development for the last four months, will be effective from 1st January 2021 and represents a £400,000 investment. This includes the creation of a purpose-built 10,000 sq ft warehouse with the ability to store 330 pallets; dedicated inspection areas for customs and DEFRA and the training of four new dedicated staff to run the 24-hour operation.

The decision to set up a BCP away from the ports – Spalding is within easy reach of both Dover and Southampton docks – is in direct response to the ongoing delays and excessive queues which currently impede the onward movement of freight. The imperative to take action is amplified given the specialist and sensitive nature of PML’s cargo – the majority of consignments require temperature-controlled conditions – and the anticipated further disruptions likely to be caused post Brexit.

The long-standing and trusted working relationship between the two companies has enabled a seamless journey from the inception of the idea to create a dedicated BCP at FreshLinc’s 70,000 sq ft site, to completion of all the works required to meet the demanding criteria as defined by HMRC and DEFRA.

“This is a great opportunity for us to work with PML to maintain the continuation of the food supply chain especially against the backdrop of the uncertain times we are now facing as a result of the challenges posed by Brexit and the coronavirus. The BCP is a perfect example of two like-minded businesses coming together to provide an innovative solution to an industry problem.”

Lee Juniper, Operations Director at FreshLinc.

“This venture will enable us to move product much faster from the ports, cut down on wasted journeys and should ultimately deliver a minimum of 24-48 hours additional shelf life on all our customers’ products. Our priority is to guarantee the safe and timely transfer of goods, ensuring that there are no breaks in the cold chain. By creating a remote BCP, we are no longer constrained by the issues at the ports and PML is able to operate and manage its own facility.”

PML Sales Director, Nick Finbow.