Air cargo spot rates jumped 41% in May to $3.40 a kilo. Xeneta says the peak has likely passed, leaving shippers with one decision: lock in Q3 rates now or wait for prices to soften.
By the numbers: May’s spike was driven by the scramble for capacity after the Hormuz disruption. But the contract market is already cooling. Long-term rates rose 22% and peaked in late April, which Xeneta reads as the high point. Demand grew just 4%, planes were 61% full, up 2 points, and capacity ended May 1% above last year as Middle East carriers restored service.
Where rates split by corridor: Changes from pre-conflict late-February levels moved in different directions:
Northeast Asia to North America: up 39%
Southeast Asia to North America: up 33%
Europe to North America: down 26%, as summer passenger flights freed up cargo space
Why relief is coming: Three factors points to lower rates in June. Contract pricing is easing from the April peak, Middle East carriers have returned to near-full operations, and summer passenger flights are adding belly capacity. Demand won’t prop rates up. China’s e-commerce exports fell 11% in April, and US-bound volume dropped 33%, marking a fifth straight monthly fall as new de minimis duties reshape parcel air freight. Only one lane remains strong: transpacific AI and semiconductor shipments.
The shipper play: Most buyers are waiting rather than locking in at current levels. Shippers have “a sense of ‘here we go again’ in terms of rates volatility,” Xeneta airfreight chief Niall van de Wouw said, but are “buying time by temporarily accepting the surcharges that come with extending existing capacity contracts.”
What’s next: June’s numbers will show whether the peak call holds. Van de Wouw expects spot rates to fall year over year next month because there are “not a lot of industry verticals that are booming at the moment” to keep them up. With demand softening on both air and ocean, the argument favours waiting over locking in.
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