Airfreight rates on the up as January draws to a close
30 / 01 / 2024
Source: Jaromir Chalabala/Shutterstock
Airfreight rates in January climbed as the month progressed due to the approaching Lunar New Year holiday and anecdotal reports of a move from sea to air due to the Red Sea crisis.
The latest figures from the Baltic Exchange Airfreight Index (BAI) show that in the last full week of January rates from Hong Kong to North America climbed 8.4% on a week earlier to $5.15 per kg.
From Hong Kong to Europe prices last week were up 4.5% week on week to $4.16 per kg.
Airfreight rate data provider TAC Index said the increase was expected.
“The increase is in line with expectations that rates may spike following disruption to ocean shipping in the Red Sea, though sources also point out that rates often rise in the runup to Chinese New Year,” TAC said in a weekly market round-up.
This year the Lunar New Year holiday falls on February 10 compared with January 22 last year.
Forwarders have been reporting increased interest in sea-air services and airfreight as a result of the Red Sea disruption.
While rates increased this week, for the month overall prices were down on a year ago.
BAI figures show that January rates from Hong Kong to North America decreased 15% year on year to $5.22 per kg, while rates from Hong Kong to Europe were down 16.9% to $4.12 per kg.
Rates on the routes have been trending downwards since the third quarter of 2022 as the aviation market began its slow recovery from the Covid pandemic.
At the same time, consumer spending has been hit by a cost of living crisis resulting in a downturn in air cargo demand.
IATA is expecting rates to continue to decline this year, with the expectation of a 20.9% fall in yields, as carriers continue to add capacity back to the market.
However, prices in January were still above pre-Covid 2019 when carriers achieved $3.66 per kg from Hong Kong to North America and $2.83 per kg from Hong Kong to Europe.
