Semiconductors & LCDs in Great Demands exceed the supply of space
Written by Simon Kim in KFT, Seoul

Under the effect of improvement of South Korea Economic conditions in the electronic IT sector (semiconductor, LCD), air cargo volume from the coutry is soaring theseday.

According to the Ministry of Knowledge Economy (MKE) of the county on April 2, exports of semiconductors totaled $4.05 billion in March, a rapid increase of 123.8% against the same period of last year ($1.812 billion). Exports of displays including LCDs in March were brought up from March ($2.53 billion) to post a 45.2% year-on-year increase to show a similar surge to semiconductors.

As air cargo volume of electronics and IT products sharply rose, Korean Air(KAL)’s March cargo volume also went up approximately 22% against the same period of last year to total 76,278 tons, the highest monthly record since the airline had been established. the cargo volume of Asiana Airlines, one of South Korea`s two major airlines, in March was estimated to hit 63,192 tons, the highest record. Incheon Airport’s March air cargo volume amounted to 241,935 tons (estimated), over a 26% year-on-year increase.

The aviation industry of South Korea presumes that among overall air cargo demand, electronics and IT products such as mobile phones, LED TVs and semiconductors account for over 50%.

The KAL’s traffic volume of this first quarter has been increased around 20% compared to the previous year.

The total freight carried by Korean Air during 1st Quarter this year was around 400,000 ton and 75% were carried by freighters.

KAL insist that her freighters are being operated at full capacity this year but demand of cargo space has aleady exceeded the supply in the country aviation cargo market. Most of shippers and freight forwarders in the market are screaming due to the short of space from Incheon Airport.  
Korean Air is finding the way to increase freighter.

For example KAL has enhanced its freighter service between Incheon and Hanoi from 2 to 3 times a week from April 5th. It intends to develop various markets like Central & South Americas. Searching and developing untapped markets is one of Korean Air’s important missions. Korean Air will continuously introduce quality service to the customers who has not yet exposed itself to.

KAL is also assaying that with the United States’ economic stimulus package, a recovery in demand has picked up. Also, Especially before a big sports event such as World Cup which will be held in June, a large volume of orders for South Korea’s HD televisions has been placed to greatly increase the cargo volume across the United States and EU. The increase in cargo volume is also caused by the high demand for IT related components in China along with its economic recovery.

"Expect increase on KAL volume Predicts demand increase coupled with economic recovery in Asia region. As for Korean market, IT related items such as cellular phones, LCD etc are showing strong surge in export. However, it is possible for unstable oil price to affect air freight industry as it did before," said an official of KAL’cargo strategy & develoment department.

But some dangerous concern is lurking in the future. "Although demands for air cargo will face earnest recovery in year 2011 after unstable Global economy gets relieved, as for airfreight industry, concerns are looming around capacity overflow due to reactivation of grounded aircrafts and introduction of new fleets by carriers. Upswing on yield will be limited due to delay of demand recovery of America and Europe," predicted KAL.