Air Freight Market Update
December 2024
Global air cargo demand stays robust, fueled by e-commerce growth in China and the Red Sea conflict, causing capacity challenges and higher rates on transatlantic and transpacific routes.
Global Air Cargo Update
Global Air Cargo Demand
- Global air cargo demand continued strong in Nov’24, with shippers rushing to move goods to the US ahead of anticipated tariff hikes, driving a surge in air freight activity.
- E-commerce growth in China and Red Sea conflict set to drive double-digit air cargo traffic growth in 2024, while traditional B2B air cargo market remained muted.
Global Air Cargo Capacity
- Global air cargo capacity faces challenges despite a 3% YoY growth, as high demand continues to exceed available air cargo supply.
- Transatlantic and Transpacific routes are experiencing capacity constraints, leading to industry backlogs in key trade lanes and rising rates.
Regulation/News
- Potential strikes at US east and Gulf coast ports in January could lead to congestion and a shift to air cargo.
- Hong Kong Civil Aviation Department (HKCAD) will liberalize cargo fuel surcharges starting Jan’25, allowing airlines to set their own rates.
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Regional Air Freight News
Europe
- European air freight volumes continue to show an upward trend, despite geopolitical and economic challenges.
- Air cargo carriers introduce mandatory surcharges to offset costs of EU's 2025 SAF blending quota
Asia
- Strong market demand persists, with carriers allocating more capacity to Asia to mitigate supply chain disruptions.
- Long-term trend of relocating manufacturing to SE Asia will further influence carrier capacity allocations and flight routing in 2025.
Middle East and Africa
- Middle East exports to Europe remain strong, driven by sea-air volumes and Red Sea disruptions, pushing airfreight rates higher.
- Flight schedules ex-MEA are gradually returning to normal, with 32 additional flights added to boost capacity.
Americas
- Transatlantic air cargo rates have risen as airlines shift capacity from Europe to Asia.
- US plans to impose new tariffs on imports, potentially hindering e-commerce air cargo growth from AP markets.
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