LOGISTICS companies have called on the Australian government to further extend subsidies for air cargo flights to allow essential supplies such as personal protective equipment to be imported, reports Melbourne's Financial Review.
The Freight & trade Alliance (FTA), which represents 445 businesses including importers, exporters and logistics group, has written to Trade Minister Dan Tehan asking the government to keep funding a temporary body known as the International Freight Assistance Mechanism.
Hong Kong's Cathay Pacific, which has been bringing medical supplies to Australia during the pandemic, has had to cut cargo flights due to aircrew quarantine restrictions in Hong Kong.
Australia has spent more than A$1 billion (US$720 million) to IFAM since April 2020 to subsidise the cost of exporting some products by air, such as fruit and seafood, and importing medical and PPE supplies needed during the pandemic.
Most of Australia's air freight is put in passenger aircraft but the grounding of many aircraft during the pandemic has reduced available space for cargo and pushed costs up. Air cargo rates have doubled since March 2020, according to Freightos.com, a freight booking and data company.
While the government's plan to end IFAM in mid-2022 made sense last year when Australia's vaccination programme was getting under way, the rapid global spread of omicron has 'generated considerable uncertainty for the airfreight market for the foreseeable future', FTA director Paul Zalai said in a letter to Mr Tehan.
Both Qantas and Virgin Australia have slashed flights scheduled for the next few months as people delay international travel.
The lobby group has highlighted Cathay Pacific's announcement on January 6 that it will cut freight services to Australia and other countries in the first quarter due to the Hong Kong government's requirements for aircrew to spend seven days in quarantine.
'This response is likely to have a significant effect on supply and consequently rates,' Mr Zalai said in the letter. 'We are expecting similar decisions and impacts across the broader aviation industry.
'While we hope that the omicron outbreak will soon peak in Australia and other key overseas markets, we urge the federal government to make contingency plans with appropriate budgetary considerations to continue IFAM, on a needs basis, post the scheduled termination in mid-2022.'
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The Freight & trade Alliance (FTA), which represents 445 businesses including importers, exporters and logistics group, has written to Trade Minister Dan Tehan asking the government to keep funding a temporary body known as the International Freight Assistance Mechanism.
Hong Kong's Cathay Pacific, which has been bringing medical supplies to Australia during the pandemic, has had to cut cargo flights due to aircrew quarantine restrictions in Hong Kong.
Australia has spent more than A$1 billion (US$720 million) to IFAM since April 2020 to subsidise the cost of exporting some products by air, such as fruit and seafood, and importing medical and PPE supplies needed during the pandemic.
Most of Australia's air freight is put in passenger aircraft but the grounding of many aircraft during the pandemic has reduced available space for cargo and pushed costs up. Air cargo rates have doubled since March 2020, according to Freightos.com, a freight booking and data company.
While the government's plan to end IFAM in mid-2022 made sense last year when Australia's vaccination programme was getting under way, the rapid global spread of omicron has 'generated considerable uncertainty for the airfreight market for the foreseeable future', FTA director Paul Zalai said in a letter to Mr Tehan.
Both Qantas and Virgin Australia have slashed flights scheduled for the next few months as people delay international travel.
The lobby group has highlighted Cathay Pacific's announcement on January 6 that it will cut freight services to Australia and other countries in the first quarter due to the Hong Kong government's requirements for aircrew to spend seven days in quarantine.
'This response is likely to have a significant effect on supply and consequently rates,' Mr Zalai said in the letter. 'We are expecting similar decisions and impacts across the broader aviation industry.
'While we hope that the omicron outbreak will soon peak in Australia and other key overseas markets, we urge the federal government to make contingency plans with appropriate budgetary considerations to continue IFAM, on a needs basis, post the scheduled termination in mid-2022.'
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