Airfreight rates up as capacity comes under pressure

Airfreight rates from key Asian hubs continued to climb last week as ocean capacity shortages and personal protective equipment shipments pick up.

The latest figures from TAC Index show that average airfreight rates from Hong Kong to North America last week climbed for the fourth week in a row as they increased by 4.6% week on week to $5.70 per kg.

From Shanghai to North America average prices increased for the second week in a row as they jumped by 10.2% on a week earlier to $5.62 per kg.

From Hong Kong to Europe there was a 1.5% decline to $3.21 per kg but from Shanghai to Europe there was a 14.8% increase to $3.81 per kg.

Rates continue to track ahead of last year’s levels but they are down on the high levels recorded in mid-May.

Eytan Buchman of rate portal Freightos said that ocean capacity shortages could be having an impact on the market.

“The high rates and additional lead time to ship by ocean are pushing some time-sensitive shippers from ocean to air, contributing — together with the increase in personal protective equipment demand and peak season electronics — to the recent increase in air rates.”

Peter Stallion of air cargo derivatives broker Freight Investor Services (FIS) also said that electronic product launches were beginning to affect the market, along with an uncertain capacity outlook.

“In fundamental terms we are still looking down the barrel of various airfreight-centric product launches that correlate with a bullish viewpoint. However capacity still remains highly uncertain, linked to passenger traffic inconsistencies,” he said.

“The market appears (at least on ex.APAC routes) to pricing about 25% above its 2019 level for the time-being. What is more of a concern for shippers, is a new and persistent requirement to absorb both the higher airfreight rates, and direct market volatility.”

Freight forwarder Flexport concurred that product launches were helping push up rates — it expects capacity to remain tight for the year.

The forwarder added that several Chinese carriers had sent their freighter aircraft in for heavy maintenance over the last couple of weeks.

Share this story

Related Topics

Latest airfreight rates news

Etihad Cargo sees revenues decline in 2023 as market rates cooled

Etihad Cargo registered a decline in its cargo revenues last year as the wider air cargo market cooled following the…

Read More

Share this story

Airfreight rates on major trades remain down on 2023 levels in February

Air cargo rates continued to register declines on major east-west trades in February compared with last year as the timing…

Read More

Share this story

Awery reports Red Sea-related rates rise

There are conflicting opinions about the extent to which the Red Sea shipping crisis is impacting airfreight, but airfreight rates…

Read More

Share this story

Damian Brett

Damian Brett
I have been writing about the freight and logistics industry since 2007 when I joined International Freighting Weekly to cover the shipping sector.After a stint in PR, I have gone on to work for Containerisation International and Lloyds List - where I was editor of container shipping - before joining Air Cargo News in 2015.Contact me on [email protected]