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West Coast Airports Target Cargo Growth

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By: Ian Putzger
2014-01-01

Prince George is not a typical fuel stop for freighters flying from the eastern part of North America to Asia, but the airport authority hopes that some will embrace this scenario. Work on a fuel farm with a capacity of some 600,000 litres was nearing completion before Christmas, and the authority is looking to get a second tanker truck, which will make it possible to fuel a B747 freighter in less than 90 minutes, according to Al Ridgway, director of cargo development.

Asian carriers are usually full flying into North America but have vacant space on the return leg to Asia, so the idea is to stop in Prince George to refuel and top up on cargo, he explains.

“We have identified that there is a market for perishables exports from Central BC,” he says, adding that he hopes to complete a 25,000 sq ft cross-cocking facility for perishables shortly.

Besides seafood, berries and cherries, Ridgway is looking to live animal shipments to Asia to attract Asia-bound freighters. Traffic related to the $70 billion worth of resource and energy infrastructure projects in the region should provide another stream of cargo for freighter operators.

“I think there is a good chance to develop project work,” comments Ridgway. A pipe manufacturer has expressed interest in using Prince George as a staging area, and some engineering firms have set up offices in town, he notes.

The airport’s runway is 11,450 feet long - enough to accommodate any freighter, including the 150-ton Antonov-124, which touched down at Prince George in 2012 to ferry six helicopters to Africa.

In pursuing project traffic, Prince George faces stiff competition from Edmonton, which has hosted a good deal of oil and gas-related shipments. This traffic has brought a steady stream of freighter charters to the Alberta airport, pushing up its throughput by 6 percent.

Besides the oil and gas sector, mining has been a driver for cargo growth, which has been further fuelled by rising volumes of perishables and pharmaceuticals.

Last summer work kicked off on a cargo building for forwarders and customs brokers with a footprint of 55,000s q ft. According to Norm Richard, director of air service development, this is on course to open in the spring.

The project marks the second phase of the overhaul of Edmonton’s cargo area, following the opening of the airport’s cargo village in 2012, which comprised of a 50,000 sq ft complex with three buildings and access to 236,000 sq ft of apron space. Those facilities are fully occupied.

The development plan calls for the establishment of an area of some 32 hectares at the south side of the airport for light industrial use, mostly logistics and warehousing and light manufacturing. Richard and his team are currently working on three cargo facility projects which he hopes to unveil some time in 2014.

“What we have been doing over the last two years and what we continue to do is building relationships and listen to our customers,” Richard says, adding that the latter group includes manufacturers and their logistics providers. This dialogue has involved key industry groups, such as the Canadian Manufacturers and Exporters Association, the Canadian Association of Importers and Exporters and CIFFA, the Canadian freight forwarder organization. They have been stressing logistics solutions using gateways in Alberta and have made efforts to promote such concepts, most recently with the Roads.Rails.Runways conference, a two-day event in Edmonton at the end of last September.

Edmonton’s push for cargo is not helped by the proximity of Calgary, which has more widebody connections, more international flights and more cargo. Richard sees more common ground than rivalry between the two and insists that the real competition is further away.

“It is not one market versus another. Our objective is to ensure supply chains are flattened and originate in Alberta,” he comments, adding that the main objective is to draw in cargo that is trucked to large US gateways.

Like Edmonton, Calgary is in the middle of a major expansion of its cargo infrastructure. It has completed a multi-tenant facility with a footprint of 110,000 sq ft that houses Air Canada, Cargojet, WestJet, multinational handling firm Menzies and the CBSA. The new cargo area in the northern part of the airport has an adjacent apron for freighters.

The facility is fully leased, and the airport authority is now working on the second phase of the development project. Details have yet to be released, but the plan calls for a $70 million investment in further warehouse and apron space.

This will not just add more square footage for handling. A key component of the plan is the development of infrastructure to handle special cargo. Calgary took a major step in that direction a couple of years ago with the opening of a live animal facility with 28,000 sq ft of warehouse space and a 14,000 sq ft loading area.

According to Mark Ruel, director of air service development and industry relations, the facility was designed to make the passage of animals through the airport faster, safer and more humane.

“Instead of working with handlers that just look to cut rates and cost, we look at adding value to the chain,” he says. “The key is to add value to the handling aspect. Cargo gateways that add value will see increased business.”

The concept appears to be working. According to Ruel, Calgary has drawn in animal traffic from all over North America, from show jumping horses to pigs headed to China and cattle shipped to Kazakhstan.

The airport’s throughput is up 3 percent this year. In the main, this has been driven by growing international cargo, while domestic traffic has been steady. Charter traffic fluctuates between one and three flights a week, while scheduled service saw the addition of a third weekly frequency of Cargolux, which runs B747 freighters through Calgary to Luxembourg.

Ruel is in pursuit of a scheduled freighter link to Asia, but discussions with Asian carriers have not yielded any tangible results so far. To Europe, on the other hand, he can look forward to significant capacity growth on some key routes. Air Canada intends to replace B767s on its London and Frankfurt flights with B777s this summer, and KLM plans to use a B777 in lieu of the A330 fielded so far. With 40 tons payload, the 777 can carry as much cargo as a mid-sized freighter.

Vancouver, Canada’s premier gateway in the west, has no cargo infrastructure projects in progress at the moment, and its freighter links are unchanged. Bellyhold capacity is on the rise, though, with two new international carriers entering the market in 2014. All Nippon Airways is launching flights to Tokyo Haneda airport with the onset of the summer schedule, and Icelandair will start twice-weekly flights to its Reykjavik hub with onward connections to a host of European destinations in May.



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