As a tumultuous 2020 ends, the Air-forwarders Association is optimistic about a more encouraging upcoming year. Hopefully, we will see the promise of a COVID-19 vaccine positively impacting the global economy, hence world trade.
Once the vaccine materializes, many are calling its complex distribution the “mission of the century.” The US military will probably play a significant logistical role, and we can expect to see the integrated carriers and freight forwarders providing support in getting the serum to its millions of recipients.
Of course, the efficient handling of the vaccine will be of the utmost importance, due to extreme low-temperature requirements and the need for multiple dosing. Therefore, implementation of appropriate climate-controlled warehousing is essential during dwell times either before or after air transport, along with tracking and security.
As the vaccine proliferates, we expect a gradual economic recovery worldwide, including a reawakening of the global passenger airline fleet. As people gain confidence and lockdowns dissipate, expect the leisure and the business travel sectors to rise. The equipment reemergence from months of pandemic-related storage will restore needed aircraft belly capacity that provides 50 percent of air cargo space. Of course, these additional flights should stabilize air cargo demand, thus creating less reliance on freighter charters and perhaps a return to pre-pandemic pricing levels.
As manufacturing volumes increase, we also expect a stabilization of ocean freight activity, once the initial surge of post-pandemic imports subsides. In the short term, however, expect congestion at major US ports to continue, and with it a reliance on air cargo as manufacturers strive to meet e-commerce-driven consumer demand and US workers return to normal working conditions.
Finally, as a new presidential administration begins in the US, we expect the Trump-era tariffs on China to be altered but remain in effect in the foreseeable future. While we can expect some manufacturing shifts to Southeast Asia, including countries such as Vietnam, Thailand, and Cambodia, this relocation of production will reduce but not eliminate US buyer sourcing from China. Therefore, freight forwarders should be prepared to provide import services from China, Southeast Asia, and, of course, Mexico and Canada, thanks to the new USMCA trade agreement.