Amid capacity reductions on the Trans-Pacific, South America is gaining prominence as a strategic focus for global air cargo. At the IATA CNS conference in Miami, attendees were told the shift comes with big changes for the air cargo sector and that carriers and freight forwarders “need to know how it will impact the industry”.

Peter Cerda, IATA’s regional VP for the Americas, pointed to the rapid rise of e-commerce activity in Latin America, driven in part by tariff changes. Lufthansa Cargo’s VP Americas, Stephanie Abeler, said shifting trade lanes are opening up new opportunities in South America.

However, this shift in demand could create imbalances in global capacity. Peter Penseel, president of Delta Cargo, explained that if operators move freighters away from Trans-Pacific routes – like Shanghai to Chicago – to serve South America, they risked creating capacity gaps elsewhere. “And in the case of those now in South America or in Mexico, all those changes will automatically have an impact on the entire air cargo industry,” he said. Penseel urged carriers and forwarders to constantly monitor capacity.

The influx of new players into South America could intensify competition for South and Latin American-based carriers. Andrés Bianchi, CEO of Latam Cargo said demand shifts may be limited, but supply shifts are a concern. “We have to be very cognizant of how people are moving their feed around, and how that may impact our operations,” he stated.

Brandon Fried, executive director of the Air Forwarders Association, echoed the concerns, predicting that increased investment in South America could lead to rising costs and infrastructure strain. “It’s easy to move a freighter that’s going into the United States and start running it into Buenos Aires or Lima, and that’s not a big deal, but if there’s more investment down there, it’s going to increase prices, it’s going to increase wage pressure. They’re going to have all the problems that the U.S. has dealt with for a number of years.”

Source: The Loadstar