Global logistics firms anticipate disruption, delays, and price increases for air cargo supply chains in Shanghai following a nine-day Covid lockdown in the city. Airlines are canceling cargo flights from Shanghai Pudong (PVG) following the city's Covid lockdown, with diverted cargo likely to push up airfreight rates at alternative gateways.

With Shanghai in lockdown, flights to Shanghai's big airports are slowing to a trickle. But it's not only passenger flights feeling the capacity crunch. Cargo operators are also pausing cargo flights to and from Shanghai's airports.

While China’s busiest air cargo hub, Shanghai Pudong International Airport (PVG), itself is not closed, several airlines have canceled flights in and out of the city, transport around the city has been curbed. A work from home order means production and warehouses are either closed or operating at reduced capacity, all of which is set to see delays and further pressure on capacity within the air cargo supply chain.

Scan Global Logistics expects “service disruptions and delays” due to the restrictions on transport that the lockdown imposes. Airport pickup and delivery opportunities are limited and several airlines have canceled flights to and from PVG, said the company.

This Monday, Cargolux announced it would suspend PVG flights until at least 2 April. According to Crane Worldwide Logistics, other airlines are watching. They will likely “adjust their schedule at the last minute, without prior notice.”

“Many freighters are also expected to be canceled from/to PVG due to lack of handling workforce caused by the urgent lockdown, added to the reduction of international passenger flights to PVG since 21 March. That will result in a more severe capacity shortage to and from PVG.

“Our airfreight agents also have minimal staff reporting for duty today, which will impact the customs declaration and cargo tendering to terminals and airlines.”

Indeed, Crane said today there had been a raft of further cancellations from Chinese carriers to/from Los Angeles, Chicago and Amsterdam. Qatar Airways has canceled PVG flights from 31 March until 5 April, as has Turkish Airlines until Saturday, while Singapore Airlines has also withdrawn the majority of flights until Saturday.

Westbound Logistics Services added: “It is possible that delays will be incurred for the next couple of weeks to and from the region.”

The removal of belly capacity on flights has added to constrained capacity due to the Ukraine crisis, which has forced airlines to reduce their payload as they consume more fuel on longer Asia-Europe flights to avoid Russian airspace. Western sanctions drove Russian air cargo companies out of the market. Russia closed its airspace, which extended routes between Asia and Europe. The loss of shipping supply combined with higher costs has pushed up freight rates over the past month.