Australia: Air cargo market still looking up Down Under
Tucked away in a corner of the globe lies one of the largest capitalist economies in the world – Australia – a country that is reported to have now gone twenty one years without a recession. However, looking at the current weakness in the air cargo industry globally, is Australia’s market completely unscathed by the international slump?
Michael Amson, Chapman Freeborn Australia’s charter specialist based in Melbourne, shares that like the international air cargo market there are underlying weaknesses in the general cargo sector in Australia. However, “Australia is uniquely positioned and buoyed by requirements for niche outsize air cargo services which draw from Australia’s world class mining industry,” said Amson.
Mining in Australia is a significant primary industry and contributor to the Australian economy. Although the end of a decade-long mining boom is debatable, Australia is a leading producer of minerals for the world and produces 19 minerals in significant amounts from nearly 400 operating mines.
According to Geoscience Australia, the country has a large resource inventory of most of the world’s key minerals commodities. Australia is the world’s leading producer of bauxite, alumina, rutile and zircon; the second largest producer of gold, iron ore, lead, lithium, manganese ore, tungsten and zinc, the third largest producer of ilmenite and uranium; the fourth largest producer of black coal (also the largest exporter), nickel and silver; and the fifth largest producer of aluminum, brown coal and copper.
Every resource project comes with an intricate logistics plan to ensure smooth operations and timely delivery of products. However, operation breakdowns immediately bring up the need for air charter as critical breakdown spares and critical path construction items need to be promptly delivered to site. In most situations, aircraft chartering is the best hope in reducing non-productive time.
At the same time, sensitive equipment that needs careful treatment is best moved via air charters in order to minimise handling and trucking. Besides delivering cargo to the exact location, air charter specialists have the knowledge and expertise to supervise loading and unloading.
Amson also shares that the key challenges are management of key supply routes and capacity into Australia. For example, at present there are no main deck air cargo services into Perth, which is a major hub for mining traffic.
“Moving the spotlight away from mining, we see air chartering potential from industries such as aeronautical, energy, emergency management and the relief sector.
“The strongest trade lanes we have seen are from Europe to Australia, China to Australia, and USA to Australia. These trade lanes benefit from Chapman Freeborn’s global office network by enabling fast servicing because of local knowledge and local relationships across all continents.”
Domestically, cargo movement in Australia is largely serviced by road, or domestic air express. Due to the country’s scale and growing appetite for industrial sustainment, Chapman Freeborn is seeing requirements for domestic movement of outsized cargo, which may not be suitable for road because of time considerations, and which may not be suitable for domestic air because of gauge and route limitations.
“We foresee a strong growth potential in the Australasia region for air cargo services. Australia’s impressive and large-scale investment in the mineral resources, with many projects still in the pipeline, a growing population and a country of vast proportion with growing requirements for infrastructure and services,” added Amson.