Continental Micronesia is halting cargo service to Kwajalein Atoll after the U.S. Army more than tripled ground-handling fees for the
airline without notice.
Continental is the only commercial airliner that provides cargo service to the Army's missile defence testing range and the nearby island of Ebeye.
Many of Ebeye's 12 thousand residents work at the base.
Continental's Pohnpei-based regional manager, Art Day, has been in Majuro to brief businesspeople and government leaders on the impact of the Army's decision.
Although the amount of cargo Continental handles at Ebeye and Kwajalein
is small, it is thought the halt in services will quickly affect areas such as Ebeye Hospital patient services.
From the first of June, Mr Day says Continental will no longer carry shipments of patient test samples to off-island laboratories.