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Volcano ash cloud hits airline, shipping, travel industries

From restaurants needing fish to air freight carriers switching to trucks, Iceland's volcano halts Europe.

With air freight also blocked, the shock was being felt well beyond the transport sector.

“It’s terrible. I do not have any more scallops,” said Christophe Malysse, director of the Lobsterfish company that supplies European restaurants with live shellfish imported from North America.

“If it only lasts a day or two it’s not a disaster, but if it goes on any longer it’s a real problem. Thankfully I got in a big supply of lobsters from Canada just before they shut the airports,” he said from his headquarters in western Belgium.

Malysse's North American suppliers could face even bigger problems if their fresh, perishable products are not flown out on time.

The express mail company DHL Express said it was fortunate because its hub airport in Leipzig, Germany, was able to stay open through Thursday night enabling it to keep up dispatching to most destinations. Although the airport was closed Friday morning, spokesman Joerg Wiedemann said the company was hopeful it would re-open in time for its peak nighttime flights.

Speaking from Bonn, Germany, Wiedemann explained that the company was switching some mail to trucks for European destinations unreachable by air. “We’re switching to road, which will cause some delays, but considering the entire situation, that’s the best we can do.” He said it was too early to estimate the extra costs caused by the volcano.

The impact on the insurance industry was also not immediately clear. In Britain, some insurers were classifying the ash cloud as a bad weather event, which means clients may be able to file claims if their vacations are nixed by canceled flights. However others were treating the Icelandic eruption as an “act of God” which would be outside most travel policies.

Iceland will likely be hit hardest. The explosion of the Eyjafjallajokull volcano has brought damage from ash fall and floodwaters from melted glaciers at a time when the economy is still reeling from its 2008 collapse.

Ironically wind conditions have allowed flights from the country’s main airport to North America and southern Europe to continue, but Iceland’s booming tourism trade looks certain to suffer in the volcano’s aftermath.

Following the meltdown of the Icelandic banking system in 2008, the county’s currency plummeted, turning one of Europe’s most expensive destinations into a bargain for tourists attracted by the wild Arctic landscapes.

The number of stays on the island grew by 6.6 percent last year despite a global travel slump. Tourism now accounts for 15 percent of all jobs, according to the World Travel and Tourism Council.

Iceland is even cashing in on its seismic location. One tour operator offers trips with “real-live volcano action” that promise “the hottest tour you have ever had.”

Its volcano tours are, however, canceled for the moment due to the ferocity of the current eruption.