Freight forwarders to negotiate prices with airlines in the Unicef ​​vaccine program

The six global freight forwarders will eventually determine the prices that Unicef ​​paid to the airlines for the distribution of vaccines.

Yesterday, 16 airlines announced they had signed memoranda of understanding with Unicef ​​to support its global vaccination plan.

According to the UN Children’s Organization, the agreements, which last for five years, do not include prices.

“Pricing is beyond the scope of the MoU, but will remain subject to competitive competition with nominated freight forwarders,” said Mounir Bouazar, global logistics manager for Covid-19 vaccines, Unicef’s supply department.

“The terms of the agreement are confidential, but cover the airlines’ obligations to work closely with Unicef ​​and relevant freight forwarders to ensure access, capacity, priority, schedule reliability and cold chain oversight.”

UNICEF will agree on a total rate for each country per round. His contracts are not with airlines, but with freight forwarders.

“But the MoUs are tripartite agreements between Unicef, freight forwarders and airlines,” Mr Bouazar explained, adding that “we no longer share pricing mechanisms, it’s an internal matter.”

Airlines, which are selected on the basis of matching vaccine routes and their networks, must give priority to vaccines and related equipment to the detriment of other cargo, according to the MoU.

However, it is not yet clear whether the program will actually affect other cargoes, which has been worrying air cargo buyers for some time.

An Air France-KLM Cargo spokesman said it was “very difficult to predict, as it will depend on how many vaccines will be available for distribution, compared to the need for capacity for other cargo.”

“The amount of vaccines that must be translated is significant, but if you compare it with the total demand for air cargo, it is not that much.

“We expect to be able to receive all vaccine shipments within existing capacity, and we still have the capacity to increase capacity on the tracks where needed, as not all of our aircraft are still in operation.”

Unicef ​​is one of the leading partners of the Global COVAX Facility, established to ensure that 190 participating countries have equal access to two billion doses of the vaccine by the end of the year.

Based on the indicative distribution and first-round allocation plan, 145 countries will receive immunization doses for about 3% of their population, on average, starting in the first half of this year.

Mr Bouazar added that “vaccine deliveries will follow the WHO allocation to serve countries in a fair and equitable manner, in proportion to the size of their population, in each allocation round”.

Although competitive bidding by large freight forwarders can help keep air fares as moderate as possible, MoR will provide UNICEF with sufficient capacity. The UN body struggled last year with limited capacity: in 2019, it distributed 2.43 billion vaccines by air. Last year, he managed to transfer only 1.8 billion.

But it’s not just the lack of brake capacity of the UN organization to help children.

Unicef ​​noted in December that, although the air cargo market remained difficult, with longer transit times and no easing of jet fuel prices despite falling prices, it had improved since the brutal second quarter, when it faced increases of up to 500% charter.

“In terms of costs, many airlines have suspended contract rates and confirmed all tariffs locally on an ad-hoc basis. Rates have increased significantly and rapidly, as demand for aircraft rentals has been high, with Unicef’s registration rate increasing by as much as 100% to 500% per charter. “

But he added: “Recently, UNICEF has received tariffs from airlines, some of which are short-lived, while others are for the entire winter period, which reflects some overall improvements from the second quarter of 2020.

“Air traffic restrictions have made Unicef ​​one of the biggest business challenges.”

Africa is said to be particularly challenging for air cargo capacity – and particularly worrying.

“It has a limited capacity to deal with shock,” UNICEF said. “Africa is a region that currently has only 5% of 22 million [Covid cases] currently reported, which due to low levels of testing makes it impossible to know the true extent of the infection, which … could reach nearly 123 million cases this year, causing 300,000 deaths – in which Africa could lose half of its GDP, “he warned.

The 16 airlines working with Unicef ​​are: AirBridgeCargo, AirFrance-KLM, Astral Aviation, Brussels Airlines, Cargolux, Cathay Pacific, Emirates, Ethiopian, Etihad, IAG Cargo, Korean Air, Lufthansa Cargo, Qatar Airways, Saudi, Singapore Airlines and United .