Peak season for air cargo may be muted
October delivered another in a series of solid gains, especially on big lanes out of Asia to Europe and North America.
Air freight rates were up again last month, with the global Baltic Air Freight Index calculated by TAC Data rising 8.1 percent over the four weeks to November 4, leaving it ahead by +10.9 percent over 12 months.
October delivered another in a series of solid gains this year, especially on big export lanes out of Asia to Europe and North America, says an official update. "Though not as spectacular as some had been expecting for a period when the market enters its traditional peak season in the runup to Thanksgiving and Christmas holidays."
"Some big forwarders now say there may be less of a peak season spike than they were expecting back in the summer when a lot of forward capacity was being booked via block space agreements (BSAs). Kuehne+Nagel, for instance, said in its latest results statement that it now anticipates the peak to be more muted than it expected earlier this year."
Air freight rates were still rising last month on the big lanes out of China – led by higher spot rates, market sources said – and that was despite some reported shifting of capacity from other regions to busier routes from Asia, particularly onto TransPacific lanes.
The index of outbound routes from Hong Kong was up +8.2 percent over the four weeks to November 4, leaving it ahead by +10.2 percent YoY. Outbound Shanghai was up by +12.6 percent MoM to leave it up by an even more impressive +22.4 percent YoY.
Rates on other lanes out of Asia such as from India, Vietnam and Thailand also remain a long way ahead of 2023 levels, the update added.
"Out of Europe, where the market has been somewhat in the doldrums, there were also finally some gains in October – though rates do remain slightly lower YoY on lanes to the U.S. as well as still significantly down both to China and to Japan. The index of outbound routes from Frankfurt gained +10.9 percent MoM, cutting its decline to only -3.2 percent YoY.
Outbound London Heathrow increased+15.3 percent MoM, lifting its gain to +17.4 percent YoY.
From the Americas, the index of outbound routes from Chicago bucked the rising global trend with a decline of -18.4 percent MoM – leaving it still in negative territory YoY at -15.1 percent. Overall rates from the U.S. are not down so much but do remain lower YoY both to Europe and to China, though significantly up on lanes to South America, the update added.
