Air cargo rates plummet alongside consumer demand for Bangladesh apparel

Source: The Loadstar
Date: 29th June 2022

Demand for Bangladeshi apparel is falling significantly in the US and EU and air cargo rates from Dhaka have seen a drastic decline.

Airlines are now charging $3.50 per kg to Europe and $8.50 to the US and Canada, compared with $8-$12 and up to $16, respectively, only a few months ago.

Following the Russian invasion of Ukraine and subsequent global economic downturn, consumers in the US and Europe, the major buyers of Bangladeshi apparel, are buying much less, giving priority to food and other necessities.

As a result, retail clothing stores remain fully stocked, which reduces demand for air shipments.

The director at the Bangladesh Freight Forwarders Association (BAFFA), told The Loadstar: “Though the fuel oil rate increased significantly after the start of the Russia-Ukraine war, the airlines are failing to raise rates due to the significant fall in demand.”

There should have been a big rush of air cargo ahead of the Eid-ul-Azha Islamic holiday on 10 July, but “we feel a total reverse of demand”. Buyers who were supposed to import 10 containers were taking just two or three, he added.

“The rate is falling day by day, five to 10 cents a day,” he noted.

Airport officials said there was no problem with the repaired and renewed explosive detection scanners (EDSs) that had previously caused delays, as the pressure had fallen.

“Three EDSs are always ready now, but as the cargo flow is very low, one is enough or when needed, another is operated,” said an official.

After attaining significant growth during the past year, which helped Bangladesh reach $50bn in export earnings, Bangladesh Garment Manufacturers and Exporters Association President told local media: “International clothing retailers and brands have cut work orders by 20% for the September to November season.”

NEOLink cooperated with our order processing system. He did not replace it or force solutions. Logfret did it better than other companies on the market – it adapted its system to ours. Logfret didn’t come to us saying, “We have this solution, and you either use it or we won’t cooperate.

Procurement Director

Pumps Manufacturer

We made a huge improvement in global visibility with a global platform—anyone can log into NEOLink and look at a shipment anytime, anywhere in the world. We wanted a freight forwarder with a good technology platform, which could handle the complexities of our business and we found NEOLink!

A global leader in performance materials and specialty chemicals

My suppliers have less or zero experience with international logistics. Thus, not able to create proper documentation which leads to tremendous delay. Thanks to Logfret who provide training to all suppliers and work with us to build up a consolidation hub to reduce transportation costs significantly.

One of the world’s leading designers, manufacturers and distributors of ride control products