WorldACD: Asia Pacific tonnages rebound strongly

Air cargo tonnages from Asia Pacific have rebounded strongly in the last full week of August after dipping sharply the previous week due to flight cancellations resulting from a typhoon in Northeast Asia, although tonnages from Europe have yet to bounce back from the mid-August ‘Assumption’ holiday. According to the latest figures and analysis from WorldACD Market Data, worldwide air cargo tonnages in week 34 (19-25 August) rebounded by +5%, compared with the previous week, mainly driven by a week-on-week (WoW) increase of +11% from Asia Pacific origins. That follows a -7% drop in worldwide flown cargo the previous week, most of which was linked to the impact of Typhoon Ampil on air cargo to and from Japan – and to a lesser extent South Korea – and to the 15 August holiday in various European countries. The impact of this week’s further typhoon to affect Japan, Typhoon Shanshan, are expected to be visible in next week’s report (week 35). Further analysis, based on the more than 450,000 weekly transactions covered by WorldACD’s data, indicates that 40% (or 2 percentage points) of the +5% WoW global rebound in week 34 was driven by the post-typhoon recovery of tonnages from Japan origins (+91%, WoW). The other major contributors included strong WoW increases from South Korea (+16%, WoW), mainland China (+7%, WoW), and Hong Kong (+3%, WoW). These three major export markets together recorded an improvement of +14%, WoW, and together accounted for 30% (or 1.5 percentage points) of the +5% WoW global improvement. The patterns in weeks 33 and 34 are similar to last year, where in addition to the annual ‘Assumption’ holiday, flights in Asia Pacific were disrupted by last year’s Typhoon Lan. One difference is that tonnages from Europe bounced back more quickly in week 34 last year, whereas this year the recovery from the European holiday is quite limited (+1%, WoW). Meanwhile, further analysis by WorldACD indicates that only around half of this week’s rebound in traffic from Asia Pacific is related to the recovery from the effects of the typhoon on Japanese and South Korean markets, with the other 50% resulting from renewed growth from China and Hong Kong. Combining the totals from weeks 33 and 34, overall worldwide tonnages are up, year on year (YoY), by +9%, driven by double-digit percentage increases from Asia Pacific (+11%) and Middle East & South Asia (MESA, +10%) origins, with increases of +8% from both Europe and Central & South America (CSA) origins, in addition to increases of +6% from North America and +4% from Africa. On the pricing side, average worldwide rates – based on a full-market average of spot rates and contract rates – remained broadly stable at US$2.51 per kilo, a rise of +46% compared with the last pre-Covid equivalent period, August 2019. Compared with last year, average worldwide prices are up +12%, thanks to YoY increases of +59% from MESA and +22% from Asia Pacific. Meanwhile, increases in capacity on the head-haul legs from those two markets to accommodate the increases in demand have led to continuing drops in prices on the respective back-haul lanes, with average rates from Europe down by -10%, YoY, and from North America origins by -9%. The increases this year in spot rates are, in many cases, far higher, averaging more than +100% from many MESA origins – especially to Europe – and more than +50% from various Asia Pacific origins to key markets including North America and Europe. Indeed, in week 34, spot rates from MESA as a whole to Europe were up, YoY, by +113%. That includes rates from Bangladesh to Europe of more than $5 per kilo ($5.02), a further +4% increase compared with last week and a YoY increase of +161%. That’s the highest level so far this year for Bangladesh to Europe, although tonnages flown from Bangladesh have stabilised in the last four weeks following several weeks of severe disruptions caused by ongoing political unrest in the country. Meanwhile, spot rates from India to Europe have stabilised in the last three weeks at slightly above $3.30 per kilo, down somewhat from the peak of more than $4 per kilo in April, although they remain up by +145% compared with this time last year. And spot rates from Sri Lanka to Europe of $3.42 per kilo are more than double their level this time last year (+106%). For Editorial Inquiries Contact: Editor Matt Driskill at [email protected] For Advertising Inquiries Contact: Head of Sales Kay Rolland at [email protected]