Cargo carrier Alpine Air Express said it will discontinue services in Hawai'i.

Utah-based Alpine handled less than 20 percent of the U.S. Postal Service's interisland traffic to Lana'i, Kaua'i and Moloka'i under a subcontract with Corporate Air Co. But Alpine said Billings, Mont.-based Corporate Air recently decided not to renew its contract, resulting in the termination of its Hawai'i service.

"We are saddened at the prospect of leaving Hawai'i," said Alpine CEO Gene Mallette.

Alpine said the shutdown of its five-year-old Hawai'i operations will reduce revenues by 18 percent. In 2008, the company posted operating revenues of $19.8 million.

A spokesman for the Postal Service said Corporate Air will continue to provide the mail service it previously subcontracted to Alpine.

Currently, Aloha Air Cargo transports mail to Hilo and Kona on the Big Island, and Maui. Corporate Air continues to have the contract to transport mail to Lana'i, Kaua'i, Moloka'i and Waimea on the Big Island.

Founded in 1975, Alpine is a regional cargo carrier with operations in North Dakota, South Dakota, Montana, Nebraska and Colorado.

During the short-term shutdown of Aloha Air Cargo last year, Alpine helped fill in the mail service gaps under an emergency contract with Corporate Air.