Global air freight rates fall 0.2% but remain 16.9% higher YoY

Global air freight rates edged down 0.2% in the seven days to August 10, according to the latest data from TAC Index, the price reporting agency for air freight markets and calculating agent for the Baltic Air Freight indices. The global Baltic Air Freight Index (BAI00) remained 16.9% higher than a year earlier.

The weekly decline came as expectations of a more lasting deal between the US and Iran and a possible reopening of the Strait of Hormuz eased some pressure on crude oil markets and jet fuel prices.

Rates on the busiest lanes out of China were slightly higher week-on-week to both Europe and the US. However, BAI Spot rates were mixed, falling further to Europe while increasing on some lanes to the US.

The index of outbound routes from Hong Kong (BAI30), which reflects spot and forward rates, fell 3% week-on-week and remained 15.9% higher year-on-year. Outbound Shanghai (BAI80) rose 1.6% week-on-week and was 21.4% higher year-on-year.

Rates from Southeast Asia also increased on most lanes from Vietnam, Bangkok and Malaysia, particularly to the US. From North Asia, rates were mixed on lanes from Taiwan and lower from Seoul, while rates from Japan to Europe increased.

In Europe, rates increased on busy transatlantic routes to the US, as well as to the UAE and South Africa. Rates to China were unchanged overall, while rates to Australia, India, Japan, Brazil and Mexico declined.

The index of outbound routes from Frankfurt (BAI20) fell 10.5% week-on-week, leaving it 11.0% higher year-on-year. Outbound London Heathrow (BAI40) rebounded from recent declines, rising 31.6% week-on-week. The increase was supported by gains to the Middle East, Southeast Asia and North America, taking the index to 7.2% higher year-on-year.

From the US, rates fell to Europe and the UK, as well as to several destinations in Asia, while rates to South America increased. The index of outbound routes from Chicago (BAI50) declined 3.2% week-on-week but remained 23.2% higher year-on-year.

Rates from Mexico to Europe also increased week-on-week and remained significantly higher year-on-year.