Air freight demand to be weak in Q12023
Demand to increase only as countries start recovering from high inflation: DHL Global Forwarding
Air freight demand is expected to remain low on most trade lanes in Q12023 due to high inventories and low sales, according to the latest report from DHL Global Forwarding.
"Volumes might pick-up prior to Lunar New Year but will be followed by low demand. Demand will increase only as countries start recovering from high inflation," says the report.
While capacity recovery will continue MoM subject to market conditions, spot rates are likely to be aggressive in Q1. Worldwide inflation is likely to continue into 2023 with low GDP growth, the report said.
Service disruptions outlook include employee shortage, airport backlogs due to strikes and flight cancellations and "unforeseen" circumstances due to Covid policies.
Global capacity was -10 percent compared to December 2019 but +7 percent compared to last year. "Capacity remains available on majority of trade lanes with some tight spaces on some ex-EMEA and ex-China trade lanes. With currently low volumes, capacity is sufficient to support the demand."
With improving sea freight schedule reliability and cost reduction, some volume shift continues from air freight to ocean, the update added.