Global air freight rates ease as key Asia lanes stay firm
TAC Index reports a small weekly dip in average rates while Asia-US and Asia-Europe demand keeps major lanes tight.
Global air-freight rates dipped slightly last week, though capacity constraints and strong demand continue to support high rates on many key trade lanes, according to the weekly update by TAC Index.
The agency’s main benchmark, the Baltic Air Freight Index (BAI00), fell 1.5% in the week to 24 November. Despite the drop, the index remained marginally above its level a year ago, up roughly 0.3% year on year.
Even though the overall index eased, air-freight rates stayed high on many of the busiest routes from Asia. Forward-looking spot rates from Hong Kong, under the new “BAI Spot” indices rose again through the week. Meanwhile, the broader index for Hong Kong-origin routes (BAI30) slipped 1.4% week on week, leaving it slightly lower than at the same time last year.
Routes out of Shanghai (BAI80) saw only a slight weekly drop of 0.2% but remained comfortably ahead year on year by 6.6%. Rates from other Asian hubs including Taiwan, Seoul, Bangkok and India moved up, especially on lanes to the United States and Europe, indicating persistent demand.
On the European side, some outbound lanes posted gains. The index from Frankfurt (BAI20) dipped by 3.3% for the week but was only slightly down compared with a year earlier. Output from London Heathrow (BAI40) fell modestly by 1.3% week on week, though it remains 7.9% ahead year on year.
By contrast, outbound rates from the US showed a mixed pattern. The index from Chicago (BAI50) dropped 6.1% week on week and stayed 13.8% below its level a year ago. Some lanes, for instance those from Mexico to Europe saw gains and remain significantly higher year on year.
TAC Index also lists several new routes added to its global coverage this week. On the Asia-outbound side, these include routes such as Bangkok to the US, India to Germany, and Taiwan to Europe and the US. On the Europe-outbound side, new routes include Europe to Australia, Brazil, India, Mexico and the UAE. On the North America side, corridors such as the US to Brazil, Germany, Seoul and the UK have been added, along with a Latin America lane from Mexico to Europe.
This modest correction in global average rates comes as the first phase of the traditional peak-season build-up, in the run-up to Thanksgiving in the US draws to a close. Capacity pressures remain, especially after the grounding of the MD-11 fleet following a recent fatal crash in the US, which continues to affect freighter availability and keeps pressure on rates.
