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Roaring yields

Not every live animal shipment makes for good business, with regulatory and infrastructure hurdles common. But flows through South Africa can make good, albeit tricky, yields, while horse shipments are booming and set to grow further. Ian Putzger reports

Unlike the other major US gateways, New York's JFK airport, owing to a combination of factors, has failed to strengthen its hold on international cargo flows in recent years. In an effort to reverse this decline in its importance, the Port Authority of New York and New Jersey is seeking to bolster its throughput with fresh revenue streams. To that end, it signed a 30-year lease agreement with Ark Development to design and build a 178,000ft2 animal cargo facility at the airport. The $48 million building, which is scheduled to open during the first quarter of 2016, will have a USDA-approved full service are and 24-hour quarantine capabilities.


For Calgary International Airport, a greater focus on animal traffic has paid dividends. An animal facility set up a few years ago has become a magnet for shippers all over North America, according to Mark Ruel, director of air service development and industry relations.


Luxembourg recently underwent an expansion of its animal station, boosting its capacity to 50 stalls, a move that underscores home carrier Cargolux's establishment of a formal service offering for animal transportation under the CV Live brand earlier this year.


Another carrier that has built up its animal transport capabilities is Qatar Airways, which reached its present apex with a ‘five-star’ service for horses that includes temperature-controlled zones, spacious stalls and dedicated grooms. At its home base, the airline runs a fully equipped, state-of-the-art animal facility. Besides horses it caters to pets, livestock, tropical fish and small mammals.


"Quite a few airports and airlines are becoming better at handling animals," comments Charlie McMullen, global sales and development manager at animal logistics specialist Intradco, a Chapman Freeborn subsidiary.


The stability of yields in this segment is one of the more powerful attractions. The downturn that has hit rates on other commodities has not played out with live animal transportation, notes Gerald Bergkamp, director of Variation Live of Air France-KLM Cargo. For the most part, growth has not been spectacular but rather, steady, he adds.


Only two segments in the live animal category have failed to produce solid yields: firstly, tropical fish. These have been a shrinking segment, according to Lufthansa Cargo – Bergkamp notes that Middle Eastern carriers have pushed aggressively into this sector over the past two years. Secondly, hatching eggs; although they have produced stable volumes over the years, they do not generate strong yields. "We use them as filler freight," he remarks.


The star performers have been horses. Not only are their numbers on planes growing rapidly; top race horses are worth millions of dollars and their owners spare no expense to make their journey as stress-free and agreeable as possible for them.


"Every year the number of horses moving through Qatar Airways Cargo’s network grows, as does the number of charter flights we organise for horse movements. Since 2012 we have transported more than 4,000 horses," reports Uli Ogiermann, the carrier's chief cargo officer.


"We also offer full, part and combination charter services to transport the horses. We have successfully performed charters for important clients including Fédération Equestre Internationale and Qatar’s Al Shaqab equestrian centre," he continues.


The trade lanes between Europe and North America, as well as South America, have been traditional strongholds for horse shipments. This traffic is still increasing, but the juicy growth is to China, notes Bergkamp.


"The frequency and number of horses we move increases year on year. China's appetite for horses is growing all the time," says McMullen. In emerging markets, the desire of the prosperous to have their own horses rises markedly, as does the number of equestrian events, he adds.


Down the road he sees India and Pakistan as up and coming markets for horse shipments, but this will take some time to shape up, he cautions. "This is very difficult. We have a road to clear there."


Pet shipments have also been rising. AF-KLM moves about 40,000 pets per year; according to Bergkamp this segment is going up 5% or more per year.


Intradco’s management, which comes from an equestrian background – horses account for 80% of the company's business – looked at pets but decided not to pursue it. "There is a lot of competition and you are dealing with small amounts, yet you have to do quite a lot of legwork," McMullen says. Instead, Intradco expandedits range to exotics and livestock logistics.


With almost 30 million moving in a year, baby chicks make up a considerable chunk of AF-KLM's animal traffic. "These are regular flows," says Bergkamp. The chicks have to be flown when they are one day old, as in the first two days of their lives they have sufficient body mass to go without feeding on the trip.


This means that the shipment date is tightly planned, working on a 30-day cycle in the hatchery. The movement of exotic animals (mostly between zoos), on the other hand, follows no clear seasonal pattern and leaves carriers with less room to plan, although the yields are considerably better.


Livestock traffic also tends to be irregular. Given the number of cattle or pigs involved, it quite often requires charters, McMullen points out. On the whole, however, animal charters have diminished. "For bigger events, especially with horses, we do charter, but we try to stay as close as possible to schedule," remarks Bergkamp.


In many cases bellyhold capacity will do, even with larger animals like cows or even rhinos. "Rhinos regularly move on the lower deck. The cages are less than 160 centimetres in height," says McMullen.  >>

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