Air freight rate indices suggest that prices may be stabilising and even rising on some routes and while the peak season failed to materialise this year, the market is definitely getting tighter, with lifts in global rates and tonnages...
Air freight rate indices suggest that prices may be stabilising and even rising on some routes and while the peak season failed to materialise this year, the market is definitely getting tighter, with lifts in global rates and tonnages after China’s Golden Week.
Market data for the last two weeks of October showed a 1% and 4% increase in global tonnages, which reversed the drop triggered by China’s Golden Week holiday break.
Trans-Pacific load factors were at 89% in the first half of October, which is close to peak pandemic levels and means that any sudden increase in demand will see space squeezed very quickly.
Air cargo space from China to North America is in short supply as strong eCommerce demand outstrips the slow return of passenger flights and the essential belly cargo capacity they add, with rates rising in the first three weeks of October.
The major eCommerce companies in China are buying up space, with November online shopping promotions looming and much of any available air cargo space will go towards moving sales from China’s Singles Day, Black Friday and Cyber Monday in the US.
While overall global tonnages, rates, and capacity increased, the regional picture is more mixed, with notable increases recorded on Europe-Asia Pacific (+11%) and Intra-Asia Pacific tonnages also rose strongly, up 11%, with modest tonnage and rate increases (+2%) on the big markets ex-Asia Pacific, to North America and Europe.
TAC’s Baltic Air Freight Index noted that the week to 23 October experienced a 2.8% increase, helping to further reduce the year-on-year decline to 33.7% and suggested the figures were evidence of a bounce, pointing to firmer pricing out of China.
Outbound routes from Hong Kong gained a further 2.7% week on week, to trim its year-on-year decline to only 19.2%, with rates rising to Europe as well as to North America, TAC said.
Outbound Shanghai was up even more strongly, by 4.1% week on week, to leave its year-on-year fall at 27%, mainly driven by the rising rates to North America, with rates to Europe sliding.
Rates from US to China overall were rising strongly,
but the biggest rises on the week were out of Vietnam, with our colleagues in-country confirming that rates rose very sharply week on week on the strength of spot demand both to Europe and the US.
For valuable, fragile and time-sensitive cargoes there has never been a better time to use air freight, with extremely competitive rates and really interesting service, route and rate combinations.
We have solutions for every critical shipment, please EMAIL us for insights, advice and pricing.The post Global air freight looking stronger appeared first on Norman Global Logistics.
View Entire Post
