Aircargopedia Newsblast: December 2021!
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16th December 2021  
 


Dear Air Cargo Professional:

COVID 19 risks for Air cargo operators by Pat from SUNTEC.

Read more about supply chain operations in this article by Peter Canellis, Professor of Management, Vaughn College.

In more World Air Cargo news, Cargolux strikes deal with IBS Software to revamp Cargo Management System by Kevin Pflug.

dnata continues to be recognised for achieving the highest safety standards. Emirates SkyCargo helps UAE company export premium oysters to Moscow.
  DJ Ghosh

D.J. Ghosh
President & Publisher
AIRCARGOPEDIA
WWW.AIRCARGOPEDIA.COM
”The Complete Encyclopedia for the Air Cargo Professional & Investor”


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Air Cargo Operators - COVID19 Vaccine Risks

COVID-19 vaccine distribution may be an exciting new opportunity for cash-strapped airlines. But carriers and their supply chain partners should work with insurers to ensure any policies are suited to the new risks, even if all parties are experienced in the transport of pharmaceuticals. The sheer size of the logistics operation now required to deliver enough vaccine for our planet’s 7.8 billion people, scattered across some of its most remote regions, is daunting. Indeed, the scale of the challenge is unprecedented.

Traditionally, global pharma shipments that are transported by air to the end-user destination are in the minority, but the ‘speed-to-market’ requirements of the COVID vaccine is expected to put unprecedented strain on the supply chain, including airports, ground-handlers and freight forwarders.

Three of the vaccines’ biggest manufacturers - AstraZeneca, Pfizer and Moderna – are estimated to have the collective capacity to produce 10 - 20 billion doses by the end of 2022, enough for approximately 40% of the world’s population (acquiring immunity will require two doses for some vaccines). For air-transport providers and their partners in the supply chain, the pharmaceutical industry has always required specialist infrastructure and knowledge; at a minimum temperature-controlled environments (Pfizer’s vaccine must be stored at -70°C, for example) and a secure chain of transport are required. This has kept the greatest proportion of the market in the capable hands of a small number of experienced ‘cold’ cargo carriers. But pressure to deliver the vaccine as quickly and widely as possible is expected to require new, less-experienced operators to assist in the distribution, adding a series of new supply-chain risks.

The logistical challenges will not be the only liabilities of which carriers and insurers need to be wary. Shipment values are expected to be significantly higher than the standard international shipments covered by insurers in accordance with the limits of the Montreal Convention (‘the Convention’). The Convention limits damage-related cover for these consignments to ’22 Special Drawing Rights’ (SDR) per kilogram, or a value equivalent to about US$30-32.

Exactly how the vaccines will be valued by the market is unclear but the possibilities range from the units’ manufactured costs to their retail costs. The latter has been estimated by some manufacturers at $20-$25 per vaccine (which may double if two doses are required); given that the vaccines are comparatively lightweight cargo, this would see shipment liabilities far exceed the cover available under the limits of the Convention.

Most air carriers transport freight under the provisions set out in the Convention. But those limitations can be broken if a claimant is able to prove the carrier has acted recklessly, and with knowledge that their actions are likely to lead to the loss or damage of the cargo.

In such circumstances, claimants can seek an indemnity based on their actual loss, which could be the current market value of the goods. The Convention also allows for freight to be transported under Special Declarations of Value (SDV), which are often the market value of goods; however, most carriers prefer not to offer SDVs in order to limit their legal exposure and that of their insurers.

A carrier’s decision to go the SDV route should be discussed with insurers, as a typical policy may not cover third-party claims that exceed the Convention’s standard limits. In short, insurers and their agents should be made aware of any material changes in risk.

It remains to be seen if parties contracting to transport the new vaccines will lean on the carriers to move them under SDVs. In the interim, in the event of loss or damage to vaccines, insurers will anticipate having to offer compensation based on weight limits.

Pat Praveen
SUTEC LLC.
suntecrm.com

For any questions, please contact Pat at pat@suntecrm.com
For more info please visit www.suntecrm.com


Transport Logistics

Santa: The World’s Best Logistician

Say what you will, the guy in the red suit and funny hat knows how to get it done

Imagine that you are Vice President of Worldwide Supply Chain Operations for a manufacturer of diversified consumer products. You want, of course, to optimize your supply chain across all the key performance indicators. That’s great, but if you think you could even come close to matching the accomplishments of that portly old chuckler from the way-up-North, consider the following features of his operation:

• Customer Service: Orders are submitted by letter to one central address at the North Pole. This makes it easy to support demand planning.
• Inbound Logistics Management: The real competitive edge – still a secret to this day.
• Finished Goods Production: One central factory at the North Pole, enabling near- real time communication with Customer Service. A “pull” production system supports mass customization and eliminates the “bullwhip effect”.
• Workforce Management: Small group of dedicated, loyal, forever-young workers with reasonable compensation requirements and a commitment not to strike.
• Distribution Center: Adjacent to the finished goods factory for simplified handling of product in preparation for delivery.
• Transportation Mode: Air Cargo Only – premium service required to deliver to the entire world in one night.
• Aircraft: Flying Sled - conceived, designed, tested and produced120 years before • Power Plant: 8-Reindeer
• Fuel: Whatever reindeer eat (none of this paying for jet fuel – way too expensive!)
• Reverse Logistics: Subcontracts with thousands of facilities all over the world to manage “Kiddies’ Remorse”.

Now I ask: could you match that?
I rest my case.

I wish all of you the very best for the Holidays and for 2022.
Looking forward to when we can all be meeting, flying again, and able to afford a full tank of gas for our cars!

Yours in Supply Chain,
Peter Canellis

Peter Canellis

Regards,
Peter Canellis
Professor of Management
Vaughn College of Aeronautics and Technology


Air Canada Cargo

Cargolux Strikes Deal with IBS Software to Revamp Cargo Management System

Earlier this month, Cargolux announced that it has signed a strategic, long-term deal with IBS Software to replace the company’s air cargo management system. As such, Cargolux plans to deploy IBS Software’s iCargo SaaS solution to transform and manage its global air cargo business.

The iCargo implementation will enable Cargolux to further deliver and improve services and streamline the customer experience. iCargo’s air cargo ecosystem will allow the airline to realize improved efficiencies through lean business processes and other productivity enhancements. With application programming interfaces (APIs) providing improved data sharing, Cargolux expects to experience enhanced coordination with its partners and intends to deliver a superior service to all its customers.

In announcing the deal, Cargolux CEO Richard Forson stated, “Cargolux is in the midst of a digital transformation and the implementation of iCargo as our next generation cargo management system is another important step for us.”

Ashok Rajan, Senior Vice President and Head, Cargo and Logistics Solutions at IBS Software further noted, “Cargolux is a pioneer in the global air cargo industry and commands great respect from peers and technologists like us at IBS Software, who are deeply embedded in the global air cargo industry. We are thrilled to be associated with a global leader like Cargolux. The air cargo industry is innovating at pace with digitalization at the core. Technology is driving change and raising the strategic profile of cargo, and we’re proud to be at the forefront of such a significant shift.”

Peter Canellis
Kevin Pflug


Airbridge banner

dnata continues to be recognised for achieving the highest safety standards

New York, USA, 6 December 2021

dnata, a leading global air and travel services provider, continues to be recognised for achieving the highest safety standards. The International Air Transport Association (IATA) awarded dnata USA the IATA Safety Audit for Ground Operations (ISAGO) Accreditation, following the successful completion of a comprehensive audit of the company and its ground-handling operations at New York-JFK Airport (JFK).

David Barker, dnata’s Divisonal Senior Vice President for Airport Operations, said: "We are proud to be recognised for meeting the highest global safety standards at JFK, one of the largest dnata hubs in our international network.

"We consistently invest in training, equipment and industry-leading technologies to deliver world-class safety for our staff, partners and their customers. The achievement of the ISAGO accreditation is a remarkable milestone which demonstrates our relentless commitment to safety and service excellence.

dnata

"I thank my colleagues for their hard work and outstanding efforts that enable dnata to provide the highest level of quality and safety, every day."

dnata provides a range of ground, passenger, and cargo handling services to over 60 airlines at 22 airports in the USA. dnata USA‘s customer-oriented team consists of over 3,000 aviation professionals, who assist over 18 million passengers, ensure the smooth operations of 60,000 flights, and handle 500,000 tons of cargo annually.

ISAGO is an audit program for ground-handling companies serving airlines at airports covering the areas of organization and management, load control, passenger and baggage handling, aircraft handling and loading and aircraft ground movement. It offers benefits to airlines, ground handlers, regulatory as well as airport authorities. These include safer ground operations, fewer accidents and injuries, elimination of redundant audits, reduced costs, less damage and fewer audits, a uniform audit process and harmonized standards, improved safety oversight, harmonized auditor training and qualifications, improved quality standards, and enhanced understanding of high-risk areas within ground operations.


Turkish Cargo

To Russia with love: Emirates SkyCargo helps UAE company export premium oysters to Moscow

Dubai, UAE, 29 November 2021

Every day, Emirates SkyCargo transports between 500 and 700 tonnes of food items ranging from fresh fruits and vegetables to gourmet ice creams and cheeses on its flights around the world. Over the last one year, the cargo division of Emirates airline has been transporting a new home-grown delicacy from the UAE to some of the finest restaurants in Moscow: premium oysters. Watch this video to find out more.

Dibba Bay Oysters, a UAE start-up based in the emirate of Fujairah, has been growing premium oysters in the sparkling blue waters of Dibba Bay since 2016, currently harvesting around 200,000 oysters every month and set for exponential growth in the coming years. It is the first shellfish farm established in the Middle East region and founder Ramie Murray pioneered the pivot from the traditional Arabian pearl oyster industry to the farming of an edible oyster species. Around 50% of Dibba Bay's oyster produce is exported and Emirates SkyCargo has been facilitating the exports of these delectable oysters from the UAE to Russia, currently the most important export market for Dibba Bay Oysters.

"Emirates SkyCargo is delighted to help transport this premium UAE-grown produce to some of the most discerning connoisseurs of oysters in international markets such as Russia. Air cargo connectivity plays an important role in rapidly transporting such time and temperature sensitive food items from the farm to the fork across the globe. In the case of Dibba Bay Oysters, we are able to transport oysters freshly harvested in the morning to restaurant tables that very evening in Moscow. With our network, capacity and expertise in handling premium food products, we look forward to supporting Dibba Bay Oysters as well as other UAE based and international SMEs in their international expansion plans over the years to come," said Nabil Sultan, Emirates Divisional Senior Vice President, Cargo.

Emirates

"When exporting live seafood, the freshness of the product through the adherence to the cold chain is of the utmost importance, and our partnership with Emirates Sky Cargo has allowed us to achieve this by supporting us in reaching many major capitals around the world within the same day of harvest. Because of this we are able to arrive to virtually any major capital in the world fresher than any other oyster brand; Emirates Sky Cargo has truly enabled us to become the world's oyster," said Ramie Murray, Founder and CEO, Dibba Bay Oysters.

To support companies such as Dibba Bay Oysters and other premium food exporters from around the world catering to an international audience, Emirates SkyCargo has introduced Emirates Fresh, a three-tiered product to help maintain freshness of the food items during transportation by air. Emirates SkyCargo also has a fleet of cool dollys in Dubai dedicated to transporting food under temperature-controlled conditions.

Emirates SkyCargo operates to a global network of more than 140 destinations, transporting cargo on more than 2,800 flights every week. The air cargo carrier operates a weekly freighter flight on its Boeing 777 freighter offering 100 tonnes of cargo capacity to Domodedovo Moscow Airport (DME). In addition, the carrier also transports cargo every day in the bellyhold of its passenger flights to the city. The UAE and Russia have an important trade relationship estimated to reach US$ 4.5 billion in 2021* and Emirates SkyCargo facilitates an important segment of this trade between the two countries.

Emirates SkyCargo is a leading player in the international air cargo industry offering cargo capacity on its fleet of all wide-body Boeing 777 and Airbus A380 aircraft.


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