There are only 3 modes of transportation: Land, Sea, and Air. Sea freight consists of the bulk of global trade transportation, land transportation is predominantly used for cross border and last-mile transportation. Airfreight is a transportation service that can be complex, fast-paced and exciting. Air freight involves moving cargo from Point A to Point B via aircraft. Using air freight, cargo is transported quickly across the world, however, whilst it may seem simple, the process can get quite complicated.
You need to think about whether air freight is right for you, understand all what’s involved, have the right documentation so your shipment isn’t delayed, and engage a professional freight forwarder to ensure your transaction flows smoothly.
Air Freight transportation is for cargoes that fall into these few categories:
- Perishable Goods/Live animals that have a limited lifespan
- Cargo with an ultra-high value that requires additional security
- Cargo in small quantities or small volume metric weight
- Cargo with utmost priority in delivery urgency
- Those who chose to ship cargo by air instead of by sea will definitely fall into one of those four categories.
The purpose of this article is to serve as a general guide to arranging for air freight transportation and the underlying comprehension of how air freight transportation works.
Advantages of Air Freight
Frequency and Reach
According to OpenFlights, there are 14,110 Airports listed and 754 Seaports (according to exportvirginia). With that being said, the connectivity of air transportation, especially to land-locked areas, is definitely better than sea transportation.
You can search from a plethora of nearest airports to the final destination, this is not the case for seaports where you have only a few choices. The cost of delivering the cargo from the seaport to the destination may also be higher due to the distance at play. In addition, Air Freight schedules are compact and frequent. For certain high demand routes, there are more than 2 allocations per day. So rest assured, if you missed the flight scheduled departure, you can reschedule for the closest one. This benefit is not so pronounced for transportations via Sea. Hong Kong airport (HKG), 2016 air freight movement in tonnage for Hong Kong reaches over 5 million tonnes a year. HKIA connects to over 220 destinations and 120 airlines patron that airport.
Security
Air Cargo Security is always the emphasis of airliners and the IATA organization. In the not too distant past, Oct 2010, remains of a plastic bomb were found in a plane from Yemen to the United States of America, the Al-Qaeda terrorist group plotted and took responsibility of the bomb. The bomb took down a UPS cargo airplane. These are the incidents that outline the importance of advanced cargo security system because many lives are at stake. Air Freight shipments are also only shipped on Master Air Way Bill which is non-negotiable, it also means that the consignee is known before the shipment has been accepted by airliners. This is an added security mandated by IATA. With the terrorist bomb incident from Yemen in 2010 as a class example, it is no wonder that Air Cargo transporters and officials must know the actual consignee beforehand.
Lower Insurance Cost
Because air cargo security is of such importance, the multiple layers of security like x-ray screening and dog-sniffing add more security that the cargo is safe and secure. With the added stringent packing requirements of air transportation, the Insurance underwriters take a lesser risk in insuring air cargo. The short transit time and the air transportation track record are also a big contributing factor to lower insurance cost as well. Shorter transit time means a lower chance of cargo damaged in transit. In addition, the odds of a plane crash is 1 in 11 million, insurance adjusters like those odds for sure.
Fast Transit Time
The typical cruising airspeed for an airliner is approximately 500 knots or 575 mph. Whereas the average speed of a slow streaming sea freight liner is at 20 knots or 23 mph. Airplanes travel 25 times faster than a container ship. This is one of the many reasons why air transportation is sometimes preferred over sea or land transportation.
Disadvantages of Air Freight
Cost (to a certain extent)
When a freight cargo is measured by the pound or kilogram instead of tonne or per container basis, you know in fact that the former is going to be more expensive than the latter. But this is not always the case in every shipment. If the cargo you wish to deliver is well below the courier weight and size restriction, it is actually CHEAPER to ship that cargo by air instead via sea transportation. The reason why is that in sea freight logistics, there is a lot of minimum fixed cost attached to a particular shipment. The Terminal Handling Charges, Bill of Lading, Electronic Data Interchange Fee, to name a few are fixed at price.
Size limitation
Without a doubt, the size of an airplane is always going to be dwarfed by a freight ship’s size. Take a Boeing 747-400F with a maximum gross payload of less than 130 metric tonnes and juxtapose it with a standard Handymax and Supramax bulk carrier vessels with a capacity of 50,000 DWT. You need more than 380 trips to deliver the same amount of capacity a Handymax or Supramax bulk carrier carries in one trip.
Documentation timeliness
Preferential Certificate of Origin, issued by the country of origin’s chamber of commerce, is a document resulting from a bilateral or multilateral agreement between country(s) that reduces or eliminates import duty to promote international trade. In most instances, this document has to be presented to customs in the original copy. Preferential and Legalized Certificate of Origin usually travels with the shipment, in a document pouch, this mitigates the need to courier the original document separately before the cargo shipment arrives. The timeliness of the document’s availability is of paramount to smooth cargo shipment. If cargo is air-bound but the documents are not yet ready, this poses as a limitation to air freight transportation. Import Permit or Licensing is also another document preparation required at the destination airport, the application process may take some time and requires ancillary documents to apply which may be delayed. With sea transportation, there is a big buffer time for cargo owners to prepare documents as the transit time is longer. But, with air transportation where transit time is typically within 24 hours, there is a small disadvantage in this aspect.
Air Cargo Flow at Origin/Export
Step 1 – Prepare Shipment for export and planning
Cargo owners will first have to prepare the cargo for shipment and transportation. There are two key areas that have to be referred to by cargo owners to anticipate loading and storage requirement of air transporters. IATA Cargo Handling Manual, available in the IATA website will outline all the packing requirements to make sure the cargo is safe and secure. Unit Load Device dimensions, which will be touched on later, is important for the shipper to decide if the cargo stowage is possible into the airplane fuselage.
Step 2 – Calculate and Determine cargo chargeable weight
One should be clear about the difference between chargeable weight, net weight, and gross weight. Net weight is the weight of the actual cargo itself. Gross weight is a view of the cargo shipment in totality, including the package, pallets, and containers. Chargeable weight is based on volumetric calculation, taking into account the volumetric weight or the gross weight, whichever is the higher.
Step 3 – Arrange bookings with Air Freight Forwarder
Accompanying the booking arrangement planning are documents such as the Commercial Invoice and Packing List. The document can be named in many ways depending on the air carrier used, the booking can be called the Shipper’s Letter of Instruction or Shipper’s Booking Instruction. Whichever way, the purpose of the booking instruction is the same.
Step 4 – Preparation of Airway Bill
A drafted airway bill complete with the cargo details, shipper and destination details, and flight schedule details is prepared and confirmed by both the Freight Forwarder and the Shipper. There are many forms of airway bills, each with different arrangement procedures which are also explained further below. Some of the example air waybills are:-
- House Airway Bill
- Neutral Airway Bill
- Master Airway Bill
- E-Airway Bill
Step 5 – Transportation to Terminal Warehouse Operator
Once booking and details in the Airway Bill is confirmed, either by the arrangement of the freight forwarder or the shipper’s own, the cargo is transported to the Warehouse Terminal appointed by airlines or freight forwarders. The Transport Service provider will then issue a warehouse receipt or freight certificate. If the cargo at hand is consolidated by the freight forwarder, the freight forwarder is responsible to issue the receipt, it will then be called the forwarder’s receipt
Step 6 – Custom Clearance
The air cargo is then inspected by customs officers and any other governing agencies that regulate the export of the cargo. This is where custom officers inspect whether there are any anomalies in the cargo description, cargo weight, and measurements.
Step 7 – Loading and Stowing of cargo
Once all of the above has been arranged, the cargo is then loaded into the ULD and stowed into the airplane fuselage. The Carrier will then issue a confirmed Airway Bill as evidence of a contract of carriage.
Air Freight Calculation
The key to calculating air freight is to accurately calculate the Chargeable weight. Chargeable weight essentially means the greater of the volumetric weight or the actual gross weight of the cargo. The volumetric weight and the actual gross weight are often different because the density of every cargo is different. If you take a tonne of sulfuric acid and juxtapose it with a tonne of steel, in actual gross weight the cargo will be the same. However, the density of steel is much higher, therefore does not occupy a lot of space as compared to feathers. Knowing the density of the cargo is very helpful as it gives us a picture of how much storage space is used. The density of sulfuric acid is at 1840 kilograms per metric cube, or 114.87 pounds per cubic foot. The density of steel, on the other hand, is 8050 kilograms per metric cube, or 502.54 pounds per cubic foot.
Priority Reserve Air Freight
As the name suggests, priority reserve air freight is designed to serve shippers of heavy or bulky freight who need the advantage of reserved space on a specific flight. Often when a large cargo is transported, it is done with a priority reserve air freight to ensure there is enough space allocated to the large cargo in question.
Speed Package Service
a Speed Package service is a small package fast-delivery service. It is handled like passenger baggage without any accompanying passenger. When the cargo is time critical, for example, an exhibition is arranged by the shipper, but the shipper by-mistake did not pack an important machinery part, they can arrange for a speed package service.
Courtesy: Best air freight service in Lahore
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