Shipments of everything from fresh produce to airplane parts are in short supply as the escalating conflict in the Middle East cuts the world’s air cargo capacity by a fifth and raises freight rates, with executives bracing for backlogs of goods.
The US and Israeli air war against Iran has grounded passenger and cargo flights across the region, including in key global air cargo hubs Doha and Dubai.
That led to a 22 percent drop in global air cargo capacity between Feb. 28 and March 3 compared with the four-day period before the Chinese New Year holiday last month, according to data from aviation and logistics consulting firm Avian.
“It’s a complete shutdown of the supply chain for the Middle East,” said Abdul Moberi, CEO of Florida-based GA Telesis, which provides aircraft parts and repair services and is unable to ship parts to the region or receive parts in need of repair.
According to airline trade group the International Air Transport Association, air cargo accounts for about a third of global trade by value, with goods ranging from Apple to AAPL.O Temperature-controlled pharmaceutical products, fresh fruit and auto parts are carried in the bellies of passenger planes and in dedicated cargo ships.
Routes to Asia and Europe were affected.
Middle East carriers account for about 13 percent of global air cargo capacity, according to Evan.
Brian Bourke, SEKO Logistics’ chief commercial officer, said Europe and the Asia-Pacific region, which rely heavily on Middle East hubs, will experience the biggest impact.
“Companies in America should pay attention,” he said. “But it’s not as immediate as you are in Europe or Asia or Australia.”
Air cargo capacity on the Asia-Middle East to Europe corridor has fallen by 39 percent since the start of the conflict, even as direct capacity between China and Europe has increased by 26 percent, Evan said.
Joshua Ng, director of Alton Aviation Consultancy, said Chinese airlines can gain a competitive edge, as they can fly through Russian airspace where many competitors are restricted, giving them shorter flight times and lower operating costs.
Rates from Southeast Asia to Europe rose more than 6% to $3.82/kg since Friday, with South Asia rates up 3% to Europe and 5% to the US, according to consultancy Freightos’ Air Index.
“Whenever operational constraints increase costs or reduce capacity, air cargo rates are subject to upward pressure,” Ng said. “In the near term, shippers may start seeing higher spot rates on the Asia-Europe corridor, especially if disruptions persist and capacity constraints persist.”
Stefan Paul, CEO of Swiss logistics group Kuehne + Nagel, said on Tuesday that “some backlogs for European and US marketplaces may arise in Southeast Asia and China” by early next week.
Moving Aircraft Parts.
Critical aircraft parts are often transported by air, and prolonged disruptions could slow Middle Eastern carriers’ efforts to restore flights. In 2025, aerospace air shipments to and from the region will account for 6.7 percent of global aerospace shipments, Kuehne+Nagel said.
“If the aircraft is not flying because of war, the aircraft still needs to be able to open the skies,” said Amir Qureshi, senior vice president of Adventure Aviation.
Aventure supports around 70 airlines, including Etihad Airways, Emirates and Qatar Airways, and stocks critical components such as engine valves and avionics at its US distribution center in Atlanta.
Qureshi said many carriers are making urgent calls for parts, as sometimes a single component needs to be released from aircraft maintenance. “If the part doesn’t arrive on time, the plane sits further in the hangar,” he said, describing it as a “domino effect.”
In better news, Qureshi said some parts that had been shipped from the Dubai airport to Atlanta for repair were picked up by a freight forwarder on Wednesday.
He said that the improvement is coming gradually. “But these things are so unpredictable… Tomorrow everything will stop.”
