Air cargo spot rates rise 29% in October on Asia-US demand

The news

Global air cargo spot rates averaged $3.11 a kilogram in October, up 29% from a year earlier, per Xeneta. Demand grew 6% while capacity was flat, lifting the global load factor by 2 percentage points to 63%.

October marked the seventh consecutive month of demand growth.
“It’s strong, but it’s not a ‘peak’ season,” said Niall van de Wouw, Xeneta’s chief airfreight officer.

Why it matters: US importers sourcing goods from Asia face much steeper air cargo rate increases than those shipping to Europe.

The details

The transpacific led the rate increases. China-to-North America spot rates rose 38% YoY, compared with 6% for China-to-Europe. Asia-Pacific to North America volumes were about 15% higher than a year earlier. Xeneta linked the demand to AI-related shipments.

Europe accounts for about a tenth of AI-related goods trade but more than a third of all goods trade, according to World Trade Organization figures.
China’s low-value and e-commerce exports to the EU fell 61% in the third quarter.

Asia-to-North America is also the most expensive major air cargo lane, with spot rates above $6 a kilo. October rates reached $6.34 a kilo from Southeast Asia to North America and $6.21 from Northeast Asia. Northeast Asia-to-Europe rates averaged $4.97.

Transatlantic rates rose 10% in a month to $2.31 a kilo, the biggest monthly increase among Xeneta's 10 corridors, as airlines shifted to winter schedules.
North America-to-Europe backhaul rates averaged $1.15 a kilo.

Fuel and Middle East disruption are also pushing rates up, as carriers pay high jet fuel costs and lose capacity in the Gulf. Asia-Pacific to US spot rates averaged $7.43 a kilo in the week of Oct 19 to 25, up 41% YoY, per WorldACD data.

Rates to the US rose 59% from Japan and 55% from South Korea over the year.
Capacity in the Middle East and South Asia was down 13% from late February, when the US-Israel conflict with Iran escalated.