Asian freight forwarders said their drop in business extended last month, pushing back hopes of a recovery for some companies well into next year.
A turnaround by the third quarter of next year "is an optimistic view," said Mark Noske, Singapore-based South Asia operations manager for Emery Worldwide. Noske said in July he expected a recovery before the end of the first half of 2002.
Emery's sales for last month in Singapore dropped 11 percent from a year ago, a decline matched or exceeded by other cargo handlers in the region as companies struggled to cope with falling demand for electronics and other goods shipped by air. Since freight forwarders book space on the region's carriers, they offer an early indicator of cargo traffic.
"It's getting from bad to worse," said Michael Yeo, general manager of Singapore's Dart Express Pte, which carries electronics and other goods for clients including Creative Technology Ltd. "Industry-wide, some of us are reporting as much as a 40 percent drop in business for the year to date, and I think the average [drop] is about 20 percent." The region's airlines reported big declines in cargo space use in their latest figures published for July.
Japan Airlines Co, Asia's largest carrier, yesterday said international cargo volumes in July fell by a record 18.5 percent because of sagging demand for electronics and other jet-freighted goods.
Korean Air Co, Asia's biggest cargo airline, filled 70.1 percent of available cargo space in the month, down 6.9 percentage points from July of last year, the carrier said last month.
Japanese cargo handlers see little sign of a rebound.
Japan's overall air cargo volume fell about 30 percent in July and probably about the same last month, he said.
Yusen Air & Sea today halved its group earnings forecast to ?650 million (US$5.4 million) for the six months to Sept. 31. For the full business year, the company now expects net income of 1.6 billion yen, down from an earlier ?3 billion estimate. The company's shares fell 11.5 percent to finish the day at ?1,000 in Tokyo.
In Taiwan, the outlook is equally bleak. SDV Taiwan Co, a unit of France's Bollore SA, experienced a 40 percent drop in freight tonnage last month from the same month last year, said company Managing Director Jonathan Pettitt. Last month's tonnage was 25 percent lower than in July, Pettitt said.
Airfreight tonnage for Taiwan's AA Freight Inc fell about 20 percent to 30 percent in August compared with the year-earlier month, said Managing Director Chen Ying-chun. Volume was about the same as in the previous month, he said.
"I've been in the airfreight business for about 20 years, and this is the worst I've seen," said Simon Chang, vice general manager of Royal Air Freight (Taiwan) Ltd, which transports Nike and Adidas products using carriers including China Airlines (華航), EVA Airways Corp (長榮航空) and Vietnam Airlines.
Freight rates have more than halved from a year ago to about NT$50 (US$1.45) per kilogram, Chang said.
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