Air and sea rates benchmarking platform Xeneta has warned that the global IT failure will add further pressure to already-strained air cargo supply chains
The IT failure on Friday impacted major airports and airlines, causing disruption and delays to air cargo services that could take days or even weeks to fully resolve.
It affected Microsoft systems and saw thousands of flights grounded or delayed at the worlds largest airfreight hubs in Europe, Asia, and North America.
Air supply chains are highly complex, so a global disruption of this scale could have a severe impact, said Niall van de Wouw, Xeneta chief airfreight officer. Planes and cargo are not where they are supposed to be, and it will take days or even weeks to fully resolve.
Latest data from Xeneta shows air cargo supply chains were already under pressure prior to the IT failure.
Global demand in June increased by 13 compared to the same month in 2023, continuing an upward trend seen throughout 2024 to date.
At the same time, airfreight supply has increased by a much lesser 3 year-on-year y-o-y.
The result, says Van de Wouw, is less available capacity in the market and increasing costs for shippers, with the global air cargo spot rate climbing 17 y-o-y in June to stand at 2.62 per kilogram.
Shippers already had concerns about airfreight capacity due to huge increases in demand in 2024, driven largely by the extraordinary growth in e-commerce goods being exported from China to Europe and the US.
Available capacity in the market is already limited so airlines are going to struggle to move cargo tomorrow that should have been moved today.
These incidents can take three times as long to resolve as the length of time they last, but that is very much dependent on the scale of the IT failure and the market conditions at the time it occurs.
Van de Wouw believes it is another reminder of the vulnerability of the worlds supply chains.
We have seen in 2024 how vulnerable our global maritime supply chains are following the disruption caused by conflict in the Red Sea, he said.
Now we see vulnerabilities exposed in our air supply chains due to IT failure. We benefit greatly from technology and have grown dependent on it but there is a price to pay when things go wrong.
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