Air cargo handling capacity set to soar

Changi aims to almost double capacity; industrial zone at T5 site part of plans

An Autonomous Guided Vehicle with a container trailer at Changi Airport. At the new Changi East industrial complex, air freight terminals will be highly automated and data-driven.
An Autonomous Guided Vehicle with a container trailer at Changi Airport. At the new Changi East industrial complex, air freight terminals will be highly automated and data-driven.ST FILE PHOTO

Singapore aims to almost double its annual cargo handling capacity at Changi Airport, from three million tonnes to 5.4 million tonnes, to support the growth in the air cargo sector and ride on it.

As part of the developments at Changi East, where the future Terminal 5 is being built, Changi Airport Group is also planning an industrial zone, said Dr Lam Pin Min, Senior Minister of State for Transport.

"When fully completed, the Changi East Industrial Zone will almost double our current handling capacity for cargo," he said.

This should happen by about 2030 when T5 opens, The Straits Times understands.

Speaking at the opening of the 13th edition of the World Cargo Symposium, organised by the International Air Transport Association (Iata), Dr Lam noted that there have been significant developments in the global air cargo market.

There have been shifts in global supply chains as industries seek higher efficiency and, also recently, with more trade protectionism in some parts of the world, he said.

"But one thing remains - air cargo is an important part of the global supply chain and a key enabler of world trade," Dr Lam said.

  • >63m tonnes

    Total volume of goods recorded last year by the global air cargo community.

Last year, the global air cargo community recorded a total volume of over 63 million tonnes.

While this makes up only 1 per cent of the total volume of goods moved, the value of goods transported by air represents more than 35 per cent of world trade.

Mr Glyn Hughes, Iata's global head of cargo, told The Straits Times: "The main advantage of sending a shipment by air is speed. Within 24 hours, an item can be on the other side of the world. And that is critical for some industries where the product is perishable, and for electronic components needed in manufacturing, as well as the transport of live animals."

But this comes with a higher price tag, which accounts for air cargo's relatively high value in world trade.

Dr Lam noted that the outlook of the air cargo industry remains optimistic, especially in the Asia-Pacific.

This can be attributed to emerging growth opportunities in South-east Asia, and the rising affluence and consumption of Asia's rapidly growing middle class.

In the long term, it is also important for the sector to innovate and transform, to meet changing demands, he said. At the new Changi East industrial complex, for example, air freight terminals will be highly automated and data-driven.

Singapore is committed to growing the air cargo industry, he added.

"We will strive to enhance our connectivity with the region and beyond, and support industry innovation by offering Singapore as a place to test-bed new and innovative ideas," Dr Lam said.

Even as prospects in the region are strong, there are serious challenges facing the global cargo sector, said industry players and stakeholders at the three-day annual event, which is being held here for the first time.

While global demand for air cargo grew by 3.5 per cent last year, it was much lower than the 9.7 per cent year-on-year growth in 2017.

Weakening global trade, sagging consumer confidence and geopolitical headwinds contributed to a general slowdown in demand growth that started in mid-2018, noted Mr Alexandre de Juniac, Iata's director general and chief executive.

"Protectionism, trade friction, Brexit and anti-globalisation rhetoric are part of a genre of developments that pose real risk to our business and broadly across the economies of the world," he said.

A version of this article appeared in the print edition of The Straits Times on March 13, 2019, with the headline 'Air cargo handling capacity set to soar'. Subscribe