RMG exports overwhelm Dhaka airport
Hazrat Shahjalal International Airport (HSIA) struggles to cope with growing pressure from container shipments as buyers of international clothing brands now want to transport their goods by air to avoid congestion at transshipment ports with growing demand in their home markets.
The airport now handles 1.5 times more cargo than its capacity. Still, the large number of containers exceed the capacity of the airport, airport sources said.
Higher freight shipping costs are also pushing buyers and exporters to use air freight, but problems in HSIA’s scanners and scales, ongoing construction of the third terminal, and insufficient storage space in his freight village make it very difficult to manage the additional load. , according to industry sources.
Group Captain AHM Touhid-ul Ahsan, Executive Director of Hazrat Shahjalal International Airport, said: “Depending on the capacity of airlines, we handle 600-700 tons of cargo per day, which is about 1.5 times higher than our previous capacity.
“The number of cargo flights has been increased to 25 from 15 previously,” he added.
“The pressure of clothing freight has increased over the past few weeks. We are doing our best to transport all goods on time with our limited resources,” he added.
Freight forwarders said that 85% of the goods handled by Dhaka airport are ready-made clothes.
However, freight forwarder executives claim that Dhaka airport has lost processing capacity due to lack of scheduled flights, explosives detection system (EDS) failure and ongoing construction work. from the third terminal.
Requesting anonymity, a freight forwarder said authorities should double the number of flights to handle the additional pressure.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Vice President Shahidullah Azim said: “Many of our buyers are asking to send their goods by air freight as their stores are almost empty due to the pandemic.”
On the other hand, freight forwarding costs have increased by up to 400% depending on the destination, he added.
Apparel manufacturers have secured a large number of orders for the next few days, which could further increase that pressure, Azim said.
“The BGMEA has already held talks with the Civil Aviation Authority to speed up activities at the stages of exporting and importing clothing and raw materials,” he added.
Nurul Islam Babu, owner of Demotrans, an international freight forwarder, said: “Usually we process 20 tonnes of cargo in a month, but now it has grown to 40 tonnes.”
Chattogram Port Authority Secretary Md Omar Faruk said: “There has been no container congestion in Chattogram Port for loading and unloading of cargo over the past and a half months.”
“But, to our knowledge, some transshipment ports experienced container congestion a few days ago,” he added.
Bangladesh Freight Forwarders Association (BAFFA) President Kabir Ahmed said that in the absence of regular flights, exporters have become almost entirely dependent on cargo planes, which do not operate regularly in the country.
He said, “It is the peak period for exporting clothing, but an explosives detection system (EDS) machine has been out of service for a long time; another must be stopped after a period of work. But the explosives detection scan is mandatory. for export to European Union countries. “
He also mentioned that now they are doing such an explosive sweep with the Explosive Detection Dog Squad.
The ongoing construction works of the third terminal have also occupied part of the freight village, which has slowed down the cargo handling process, the BAFFA president said.
These are also causes of freight congestion at the airport, he added.
BAFFA Vice President Syed Md Bakhtiar said a number of scheduled charter flights were halted during the pandemic and later some freight forwarders brought in new charter flights that were not sufficient to carry this extra load.
He said the Japan International Cooperation Agency donated two scanners to the airport authorities, but their validation process has yet to be completed by EU officials.
Clothing exporters alleged that due to the shortage of airlines, their freight trucks had to wait three to five days outside the freight village. At that time, the traffic police filed a complaint against their vehicles. On the other hand, the cost of air freight has also increased by 60% to 100% depending on the destination.
Mohammad Hatem, owner of Narayanganj-based MB Knit Fashion, said: “Two of my freight trucks encountered traffic police cases while they were parked for three days on the road while waiting for enter the freight village. “
My Italian and Swedish buyers have requested urgent dispatch of these goods as their stores are almost empty, he added.
Former BGMEA Chairman Shafiul Islam Mohiuddin said: “Our cargo truck has been stuck for 10 days in the cargo village due to a lack of flights. These goods were to be sent to the main Italian fashion buyers, Max Mara.
“We clothing manufacturers are trying to ship goods by air freight due to a lack of time. If these goods are shipped by sea, buyers might miss this season. However, we also face the same problem in the airways, ”Mohiuddin said.
“If buyers do not receive their goods on time, they can be fined,” he added.
Seeking anonymity, a partner in the buying house said, “We sent 6,600 kg of goods to a Korean buyer by air to meet our deadline, but the cost of air freight was now around 60%. higher. It is about half the price of the goods. “
“The cost of air freight per kg of cargo on the Dhaka-Seoul route was $ 2.40; now it’s $ 3.85, ”he explained.
PULL & BEAR requested to send goods via Kolkata airport
Spanish clothing and accessories retailer PULL & BEAR has already asked its Bangladeshi suppliers to use Kolkata Airport instead of Dhaka Airport. Business Standard obtained a copy of this letter.
“Due to the high volumes and constant problems, we are facing difficulties for the scanners at Dhaka airport. A significant part of the cargo is transferred to Calcutta (500 tons / 1200 tons) this week,” reads. we in the letter.
BGMEA Vice President Shahidullah Azim said, “It will increase the cost of doing business.”
Export and market scenario
Bangladesh earned $ 3.38 billion from clothing shipments in the second month of fiscal 22, which was $ 2.97 billion in August of the previous fiscal year.
UK retail sales continued their negative trajectory in August compared to the previous month, due to the disruption in the apparel supply chain. However, sales volumes are slightly up 0.7%.
Retail sales in the United States increased in August as consumer demand overtook the pandemic, supply chain disruptions and other factors affecting spending.
About a year and a half after the start of the pandemic, US, UK and EU retailers are gearing up for Christmas business.