Industry stakeholders reported Thursday that the airfreight rates for cargo transport from Dhaka to Bangladesh’s main export destinations have spiked significantly due to a severe carrier-capacity crunch, leading to major disruptions in the country’s export supply chain.

The recent political upheaval, culminating in the formation of a new government, has exacerbated the situation, causing delays and congestion in both sea and air shipments.

The political turmoil, which spanned over three weeks in July and August, severely affected the logistics sector, particularly air cargo. The unrest led to a significant decrease in passenger traffic from Dhaka, prompting airlines to reduce the number of flights and switch to smaller, narrow-bodied aircraft with limited cargo capacity.

This reduction in available cargo space has created a bottleneck for exporters, particularly those dealing with perishable goods, who are now facing challenges in meeting international demand.

The reduction in available cargo capacity has driven up airfreight rates sharply. Freight forwarders reported that rates have surged to $6.5 per kilogram for shipments to various destinations within the European Union and $8 per kilogram for shipments to the United States from Dhaka.

These rates mark a significant increase from just three to four weeks ago. Furthermore, the ongoing geopolitical tensions in the region have caused some airlines to avoid flying over Iranian airspace, leading to longer flight routes and increased operational costs.

The export of agricultural products has been particularly hard hit. Exporters of perishable goods, such as vegetables and fruits, have faced severe challenges due to limited space availability on air-cargo flights and congestion at Chittagong seaport.

According to the Export Promotion Bureau (EPB), agro-processors and exporters shipped goods worth $846 million during the July-May period of the 2023-24 fiscal year, reflecting an 8% year-on-year growth.

However, the Bangladesh Agro-Processors Association (BAPA) reported losses amounting to Tk 1.2 billion ($8 million) during the curfew from July to August 5, exacerbating the sector’s difficulties.