TAC Index: Air cargo rates show resilience in late-Dec market
Asia-Pacific demand remained firm, while Europe and US lanes showed mixed pricing trends amid cautious capacity management.
Global air freight rates edged up again last week as the market headed towards the conclusion of its traditional peak season surge, according to the latest data from TAC Index. The overall Baltic Air Freight Index (BAI00) calculated by TAC added another +2.4% in the week to December 15, leaving it only fractionally lower by -0.8% from where it was 12 months ago – reflecting another positive year for the industry coming towards a close, boosted by continuing robust demand and constraints on capacity despite serious headwinds on tariffs and trade.
Rates out of China were lower overall last week to both Europe and the US. And BAI Spot rates from Hong Kong – which had been rising sharply over the previous few weeks – showed signs of flattening out and then dropping as the week went on. But the full index of outbound routes from Hong Kong (BAI30) – reflecting the whole spectrum of spot and contract rates paid – was up another +2.8% WoW, leaving it lower though by only -4.2% YoY. Outbound Shanghai (BAI80) was up again too – by +3.4% WoW, to leave it comfortably above last year’s peak season high at some +11.3% YoY. Rates were also higher again WoW on various other lanes out of Asia, including from Seoul and from Bangkok as well as from both Taiwan and Vietnam to Europe, though not to the US. By contrast, rates from India were higher to the US but a little lower to Europe – though still well down YoY in both directions.
From Europe, rates were higher yet again WoW on Transatlantic lanes to the US, as well as to China, Japan, Australia, South Africa and the UAE – though also a little lower to India, Mexico and Brazil. The index of outbound routes from Frankfurt (BAI20) gained +8.2% WoW – though remained well down on last year’s peak season highs at -18.9% YoY. Outbound London Heathrow (BAI40) also scored another chunky gain, rising +9.2% WoW to leave it only narrowly lower at -0.9% YoY.
Out of North America, rate patterns were more mixed – with falls WoW on lanes to Europe and to China as well as to Seoul, but with gains on lanes to South America led again by rising rates from Miami. The index of outbound routes from Chicago (BAI50) gave back a chunk of the previous week’s extraordinary jump, falling by -14.3% WoW – bringing it back more into line with last year’s levels at -1.9% YoY. Rates from Mexico to Europe were up a little WoW, leaving them flat YoY.
