Asia air freight market gets e-commerce increase as trade …

By Jamie Freed

JEJU, South Korea, Oct 19 (Reuters) – Strong e-commerce need is sustaining Asia’s air cargo market, with the U.S.-China trade war having minimal negative impact so far and in some cases even improving deliveries, market executives said on Friday.E-commerce is growing at

rate in populous Asia, driven by Chinese behemoth Alibaba Group Holding Ltd and competing JD.com Inc, in addition to others such as Japan’s Rakuten Inc, sponsor of Spanish soccer giants FC Barcelona.But the circulation of goods

has been threatened this year by the United States enforcing import tariffs on billions of dollars worth of Chinese items to redress what it considers unfair trade relations-with China’s government reacting in kind.”I believe today we are most likely visiting a pretty strong fourth quarter, “Randy Tinseth, Boeing Co’s vice president for business plane marketing, stated on the sidelines of a market conference.”The economy today has actually been really, really strong. Frankly in anticipation of this

geopolitical circumstance I believe people are simply going out and moving(freight)quickly.”Asia-Pacific air freight volume increased 4.8 percent in January-August, revealed information from the Association of Asia Pacific Airlines (AAPA). That was lower than last year’s 9.8 percent but came off a greater comparison base at a time of record deliveries, stated AAPA Director-General Andrew Herdman. “Given this short-term result of rushing to satisfy deadlines for tariff imposition and so on we are seeing pockets -lanes and channels-where demand is more powerful than anticipated. For the next several months the freight image remains reasonably robust. The question is what will the outlook for next year be. “WEB SHIPPING Asian airline companies have an outsized role in air cargo, representing almost 40 percent of the international market as the area is a

major production hub

and e-commerce is growing.”E-commerce is changing the method people are purchasing things, specifically in nations such as Indonesia and the Philippines,”said Jean-Francois Laval, Plane SE executive vice president, Asia sales.”It is coming from China, from Korea, it is coming from other parts of the area. You need a huge amount of freight area. “Boeing on Monday forecast air freight traffic would fold the next 20 years, growing at a typical rate of 4.2 percent a year.To fulfill that demand, the aircraft maker expects the world truck fleet to expand over 70 percent to 3,260 airplanes. Around half of air freight is brought in the stomaches of guest jets, with the rest flown on devoted freighters.WAR PREPARATION Some large Asian cargo providers including Cathay Pacific Airways Ltd and Korean Air Lines Co Ltd rely on freight for around a quarter of earnings.” In 2015 the cargo market was very hot. In 2018 it still grew. The trade stress in the world will have some effects however we have not seen it. I see restrictions can be found in a very brief time. However we are preparing for it,” Korean Air President Walter Cho told reporters on Friday.

“Anything from the U.S. to China and vice versa is going to be affected. We are taking a look at alternate markets to China and the U.S. also. “Japan Airlines Co Ltd President Yuji Akasaka said the trade war had actually made no change to the freight market to date and he only anticipated an impact if”extremes”occurred.”If it does occur it may impact

us in the future but as of right now we haven’t seen it and hope it will cool down and return to regular,”he said through a translator.In the brief term, trade war

impact has actually not been too noticeable because preliminary tariffs were on products not generally transported by air such as metals, AAPA’s Herdman said. That is starting to change, however, as responsibilities apply

to more products.”I heard one example … Seafood from the U.S. to China is subject to vindictive tariffs, so need in China is down. Think what? Need for Canadian seafood is doing just fine

.” (Reporting by Jamie Freed; Editing by Christopher Cushing)

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