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Global Market Update – March 23, 2020

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The United States has suspended entry until at least April 13 for any resident of Schengen Area countries, the U.K., and Ireland, including people who have visited these countries in the last 14 days. 

Other countries around the world are also issuing travel bans, making the situation dynamic and constantly changing. 

These global travel bans cause a dramatic reduction in scheduled passenger flights. Almost half of US and Europe trade is transported through air freight, of which over 60% is in the belly of passenger flights. Airlines most impacted are the European and American passenger airlines that operate mostly passenger flights.

Europe

The coronavirus is starting to have a big impact on air freight to and from Europe. European factories are closing, and borders are policed to limit travel and mitigate the spread of the virus on the continent. As a result, overall demand for air freight will be going down in the days and weeks to come and semi-closed borders are delaying cross border cargo movement. 

The effects of people who are self-quarantined yet working from home is also becoming visible in various airport terminals, where lack of labor is resulting in congestions and delays.

LATAM

The coronavirus is starting to impact LATAM countries, and as a result, several countries have imposed an entry ban.

Argentina and Colombia are on lockdown for 30 days, while Panama is locked down for 15 days.

Countries with entry bans (impacting all passenger flights) are Argentina, Colombia, Panama, Peru, Paraguay, Chile, Costa Rica, Ecuador, Guatemala (15 days) and Uruguay (flights from Europe).

Brazil is likely to impose an entry ban by the end of this week – over 80% of passenger flights are already cancelled by airlines proactively. 

Since LATAM countries have only recently imposed travel bans, supply chains up to week 13 remain relatively unaffected. In the course of the next week, imposed travel bans and suspension of passenger flight capacity will be reduced and subject to freighter-only service.  

APAC


China, who imposed the first lockdown, has reduced the spread of the virus and certain areas of the country are back to work, increasing demand for air freight.  
Other APAC countries impacted by new waves of contamination are taking their own measures on travel bans, cancelling events and closing factories and stores, which have a direct impact on air freight supply and demand to/from these countries.

DSV is keeping our customers’ supply chains moving as best as this global situation allows. Please continue to stay in contact with your local DSV representative for the latest updates on your freight. Various state mandated “Shelter-in-place” regulations are being followed, with employees working both in-office as well as remotely, in order to support our clients during this time.