Emirates Group has opened a Dh600 million cargo-handling extension, with a special cool-storage facility dedicated to pharmaceutical shipments at Dubai International Airport.
Emirates SkyCargo expanded its existing 80,000 square metres facility by another 11,000 sq metres, including 4,000 sq metres of temperature-controlled facility for pharma cargo, called SkyPharma.
Last year, Emirates SkyCargo opened a Dh700m, 15,000 sq metres of cool chain facility at the Logistics District in Dubai South, formerly Dubai World Central, including 4,600 sq metres for pharma products.
“This will be a good facility to serve the market and the whole region,” said Sheikh Ahmed bin Saeed, the chairman and chief executive of Emirates airline and Emirates Group.
Before the facilities at Dubai South and Dubai international Airport opened their segregated areas, pharma shipments were handled at Emirates’ general cool chain cargo areas.
The segregation followed the European Union’s stricter guidelines, including those calling for appropriate temperature controls for medical products during transportation, issued in 2013.
Emirates SkyCargo handles pharmaceutical products such as diabetes and cancer medication, blood derivatives and vaccines.
Traditionally, pharma cargo has been a fraction of the total cargo volume for Emirates. In the financial year ending March, it carried 11,000 tonnes of pharma cargo out of 2.5 million tonnes.
“With the pharma cargo, it is difficult to maintain an account because you can lose an account overnight if you mess up one shipment because the value of these shipments are in millions,” said Nabil Sultan, the divisional senior vice president for cargo at Emirates. “[In the cargo sector] we continue to see softer markets in different parts of the world, especially China and Europe, [besides there is] a huge pressure on cargo airlines in terms of yield as capacity has grown faster than the tonnage growth.”
Some of the busiest routes for pharma cargo movement for Emirates remain between manufacturing hubs and consumer markets.
About 50 per cent of global pharma cargo transportation in terms of volume is from Europe, especially Germany and Switzerland, to Asia, and 30 per cent is from India to the US, Mr Sultan said. Meanwhile, air freight costs are expected to remain flat this year amid a slowdown in global economic activity.
“We have been able to go down to what we think is profitable business, but we are not growing the way we grew a couple of years ago, and this year we would see a far more flat situation in terms of cargo volumes,” said Henrik Ambak, the senior vice president for cargo operations worldwide at Emirates.
Market forces drive the air cargo prices, and this year cargo volumes are expected to be flat.
“The excess capacity in sea freight and air freight means that everyone is fighting for a limited stake of the pie and can ill-afford to hike rates and kill yield,” said Saj Ahmad, an analyst at StrategicAero Research in London.
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