Claude Tchao believes the launch of Canadas first all-freight cargo flight service between Vancouver and mainland China will not only keep his existing Chinese customers happy but open up new markets for seafood exports.
This shortens the time by about three to five hours between Shanghai and Vancouver, the chairman of Richmond-based Tri-Star Seafood said in an interview of the China Southern Airlines service, which began flights to Chinas manufacturing and industrial centre this week.
Theres less handling and its more efficient. Customers get the product much faster, especially in peak season. This will be very beneficial.
Tchao, who exports live Dungeness crabs and geoducks to a Chinese market thats keen on B.C. seafood products, is one of the first local business owners to take advantage of the four-times-a-week service by China Southern, which also began three-times-a-week passenger flights between Vancouver and Guangzhou last month.
Tchao also uses Cathay Pacifics cargo flights to Hong Kong, where his seafood is transferred to other destinations around China, and he will continue doing so.
But he said the new China Southern flights could prompt fierce competition for the Chinese cargo market involving other airlines as well.
He noted that Cathays cargo prices are a bit cheaper than China Southerns.
Tchao said that on one China Southern all-cargo flight, he shipped 68 cases of crabs, with 20 to 25 crabs in each case, and 14 cases of geoducks, each case carrying 20 to 22 geoducks.
The seafood is shipped directly to wholesale distributors in China, who then deliver the product to seafood markets, where most are bought by restaurants for use in banquets.
They [Dungeness crabs] are very, very hot, added Tchao, who said about 15 to 20 other Metro Vancouver shippers are also sending crabs and geoducks on China Southern flights.
Although the launch of China Southerns passenger service to Guangzhou garnered most of the attention last month, its lesser known all-cargo service is also a major reason for the airlines entry into the B.C. market.
As the first all-freight cargo carrier between Vancouver and Shanghai, China Southern will be transporting products such as B.C.-grown berries, salmon and other seafood products to China, with electronic equipment, including cellphones, and new clothing lines coming the other way from Shanghai to Vancouver.
A Vancouver Airport Authority official said that due to the airports strategic Pacific Rim location and access to North Americas rail and highway systems, the new service is also a viable option for businesses in the larger Pacific Northwest region and, in fact, has already been used by Washington state berry shippers, although there were no B.C. berries on the inaugural flight.
China Southern expects that 80 per cent of its shipments will be perishable B.C. seafood, with 20 per cent berries and dry goods.
China Southern will use Boeing 777-200F freighter aircraft arriving at 1:35 a.m. and departing two hours later with a capacity of 110 tons on each flights.
YVR said that while freight is typically shipped in the cargo hold of passenger planes, the all-freighter flights use both the main deck and cargo hold, providing added space for larger goods that cant fit in passenger aircraft such as machinery, engineering equipment and generators. The all-cargo flights can even carry cars.
This facilitates trade, Tony Gugliotta, senior vice-president, marketing and business development for the airport authority, said in an interview. The amount of cargo on passenger aircraft was limited, so this provides more capacity to carry larger goods.
Cargo on passenger flights often gets left behind if lighter loads are needed.
For perishable goods, time is an issue, added Gugliotta, who called the inaugural flight of China Southerns all-cargo service a significant milestone in the growth of YVR as a key international gateway for cargo on the west coast of North America.
Its usually high-value goods that you dont want on a ship for 13 days.
He believes other airlines will launch similar all-cargo flights.
Every airport wants cargo freighters. Were hoping to convince other cargo airlines in Asia to come to Vancouver.
Dora Kay, senior policy adviser, Asia, for YVR, noted that the Cathay flights to Hong Kong are usually full and that its a perfect way for high-value, time-sensitive products to get to market.
Fashion and technology change quickly and companies want their products in stores as quickly as possible, Kay noted.
Meanwhile, Tchao said the new China Southern service doesnt stop at Shanghai.
Another important factor in this is that China Southern is the largest airline [in China] and has a lot of connecting flights to other regions in China. Thats why theres so much potential for growth.
Tchao said that about 20 million pounds of Dungeness crabs are exported to China each year from North America, about three-quarters of them from B.C.
In 2010, the airport shipped 228,000 tons of cargo, representing a total value of $10 billion; the new China Southern all-cargo service will create about 40 YVR jobs.
bmorton@vancouversun.com
