Global air cargo volumes rise 4% in October, says Xeneta

Global air cargo volumes rose by a better-than-expected 4% in October compared to the same month last year, according to Xeneta. The growth came even as businesses slowed down early imports due to higher tariff costs and the impact of the US de minimis ban. While the figures matched Xeneta’s forecast of 3–4% growth in demand for 2025, analysts warned that the outlook for airlines and freight forwarders remains uncertain, with signs of tougher times ahead.

Xeneta’s Chief Airfreight Officer, Niall van de Wouw, said the market is “definitely starting to favour shippers more than it has for the past few years”. October marked the sixth consecutive month of falling global spot rates, which dropped 3% year-on-year to $2.58 per kilogram. Contract rates, typically set for a longer period, fell even faster, down 8% to $2.31 per kilogram, showing a more cautious outlook among freight forwarders and carriers.

 Van de Wouw described the continued fall in volumes between Europe and North America as a potential “bellwether for the rest of global trade”. The corridor, dominated by general air cargo and less affected by the de minimis ban, saw demand slump by 6% year-on-year in October. Although spot rates on the route rose 4% compared with last year, this was a sharp slowdown from the 23% annual rise recorded earlier in 2025.

“When we look at the global data for October, I would have expected the number to be closer to zero because of the busy fourth quarter last year and the ongoing trade disruption,” van de Wouw said. “But the numbers indicate it was stronger than anticipated. The consensus, however, is of a market slowing down, just not as fast as expected. A 6% drop in volumes on the Transatlantic market, a major trade lane, is a harsh signal.”

The report also revealed that demand growth continues to trail behind supply expansion. Global airfreight capacity increased by 5% in October, outpacing demand for the second time this year. This imbalance has kept downward pressure on load factors and rates, reflecting a cooling market environment.

Across the world’s top three trade lanes, peak season growth momentum remained weak. When adjusted for seasonal distortions such as Super Typhoon Ragasa and China’s Golden Week, Asia Pacific to Europe cargo demand rose 11% in October compared to August. However, this was well below the 16% growth recorded during the same period last year. Corresponding spot rates increased 5%, down from a 9% rise a year earlier, showing slower activity even during what is traditionally one of the busiest times for air cargo.

E-commerce, however, continued to act as a bright spot for Asia–Europe lanes. China Customs data showed that low-value and e-commerce shipments to Europe surged 62% year-on-year in September, doubling the pace seen in 2024 and far outpacing China’s overall e-commerce growth rate of 18%. Chinese e-commerce giants have been redirecting their focus and freight flows toward Europe, taking advantage of consumer demand and expanding logistics networks across the region.

 In sharp contrast, e-commerce exports from China to the United States declined for the fifth straight month in September, falling 34% year-on-year. While the decline was less severe than the 49% slump seen in June, it highlighted the shift in trade dynamics between Asia, Europe, and North America. As freighter capacity moved from the Transpacific to Asia–Europe routes, spot rates from Northeast Asia to Europe slipped 5% year-on-year, a milder fall compared with the double-digit drops on Asia–North America routes.

Between August and October, Northeast and Southeast Asia to Europe corridors proved relatively resilient, with spot rates rising 6% and 7% respectively. On the other hand, rates on the Northeast and Southeast Asia to North America routes changed by –3% and +1%, indicating that Asia–Europe is currently the more stable corridor. Interestingly, backhaul rates from North America to Northeast Asia rebounded strongly, climbing 11% over the same period.

Looking ahead, van de Wouw expects the Transatlantic market to see modest, supply-driven rate increases as airlines trim capacity for the winter season. However, he noted that many forwarders are likely to prioritise cost efficiency over revenue growth in the coming months. “You need to mind your costs more than when you’re supporting growth,” he said. “The announcements by companies about reductions in cost are increasing left and right – and will continue – and we would not be seeing that if the market outlook was more positive.”

He also warned that as overall airfreight demand remains weak, competition for market share is likely to intensify. “For many major forwarders, organic market growth is not expected to be enough to keep their investors happy. As we head into 2026, I expect them to go for market share. You can’t create more airfreight when the demand’s not there, so you’ve got to win it from someone else. That will create more downward pressure on rates.”

Van de Wouw added that while lower freight rates may benefit shippers in the short term, they will only be helpful if overall product sales remain stable. “Most shippers would rather have 10% higher freight costs and 10% higher sales than 10% lower freight costs and 10% lower sales,” he said.

Reflecting on the broader market environment, van de Wouw noted that airfreight has benefited temporarily from global economic disruption and tariff concerns. However, he cautioned that these effects will not last. “It would be foolish to think the tariff situation will be over any time soon,” he said. “But as the noise starts to subside, the industry is being reminded that there is only limited growth in the general freight market and that is causing lower expectations for 2026.”