Air cargo spot rates globally and from Asia Pacific origins have continued to edge upward into the second half of November despite a slight dip in demand from China and Hong Kong to the US in the last full week before America’s 27 November Thanksgiving holiday and the associated retail events of Black Friday and Cyber Monday.
According to the latest weekly figures and analysis from WorldACD Market Data, average spot rates from Asia Pacific origins to the US have continued rising for six consecutive weeks, increasing in week 47 by a further +3%, week on week (WoW), to US$5.63 per kilo, mainly driven by WoW increases from Hong Kong (+7%), Japan (+14%), South Korea (+6%) and Singapore (9%), with China relatively stable (+1%). Those increases helped to push up average global spot rates by +2%, WoW, to US$2.93 per kilo, with overall full-market rates rising +1%, WoW, based on a mix of spot and contract rates.
Average full-market rates were higher, WoW, from all origin regions, by between +1% (Asia Pacific and Europe origins) and +5% (North America). But year on year (YoY), average worldwide rates are -3% lower, although the YoY deficit has narrowed from the -5% seen in September and October. All origin regions are negative, YoY, except Africa (+4%, YoY).
Compared with last year, spot rates this year from Asia Pacific origins to the US have been very significantly and consistently lower since early May, when higher US import tariffs – particularly on goods from China – and the withdrawal of ‘de minimis’ duty-free exemptions led to steep drops in US imports from China and Hong Kong. Indeed, since late June, average spot rates from Asia Pacific origins to the US have been at least -10% lower this year compared with the equivalent week last year, and mostly between -15% and -20% lower, YoY.
But for the first time in 22 weeks, this narrowed in week 47 (17 to 23 November) to a single-digit percentage deficit, standing at -8%, YoY, following a series of spot rate rises from several countries including China, Hong Kong, Japan, South Korea, and Vietnam.
Tonnages to the US in week 47 from China and Hong Kong, respectively, dipped by -4% and -1%, week on week (WoW), although they continued to bounce back from Japan, South Korea and Taiwan, based on the more than 500,000 weekly transactions covered by WorldACD’s data. But there were also WoW declines from Vietnam (-7%), Thailand (-5%), and Malaysia (-14%), markets that have been booming in recent months to the US.
Overall tonnages from Asia Pacific origins to the US dipped by -2%, WoW, in week 47, with volumes on that market possibly having now peaked for this year. However, they remain significantly (+4%) higher, year on year (YoY), thanks to continuing strong YoY increases from Taiwan (+40%) and major markets in Southeast Asia such as Vietnam (+52%) Thailand (+37%), Malaysia (+17%) Singapore (+43%), and Indonesia (27%).
Since the easing of higher US import tariffs on Chinese goods in the middle of this year, air cargo tonnages from mainland China to the US have partially recovered from the double-digit percentage deficits seen in April and May, more recently averaging only a few percentage points below their level last year. But from Hong Kong, where a higher proportion of air cargo had been relatively low-value e-commerce goods, the YoY tonnage deficit remains around -15%, YoY.
Spot rates from Asia Pacific origins to Europe have also continued to build on a WoW basis, with further WoW increases in week 47 mainly from China (+2%), Hong Kong (+3%), Japan (+8%), Taiwan (+7%), Vietnam (+7%) and Malaysia (+10%), driving up overall spot prices from Asia Pacific to Europe WoW, by +2%, to US$4.39 per kilo, although those rates are down -10% on a YoY basis from their relatively high levels this time last year.
But tonnages from Asia Pacific origins to Europe remain well above their level last year (+7% in week 47, YoY), as they have been for most of this year. By far the biggest YoY increase in actual tonnage terms is in the Hong Kong to Europe market, where tonnages in week 47 were up by +18%, YoY, although in percentage terms, Taiwan’s YoY growth is higher (+21%, in week 47).
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