Air cargo maintains “steady pace of growth”, analysts report

OCTOBER saw the seventh consecutive month of year-on-year growth in global air cargo volumes since the 3% dip in March, freight analyst Xeneta says.

Xeneta chief airfreight officer Niall van de Wouw said the market was continuing its steady pace of growth, as Xeneta had reported since March.

“It’s strong, but it’s not a ‘peak’ season and time is quickly running out for volumes to shift higher. I am already seeing Christmas trees and listening to Mariah Carey and Wham! as I travel through airport terminals,” he said.

Global air cargo spot rates (valid for up to one month) averaged USD3.11 per kilo in October, 29% higher than the same month a year ago.

Rates were influenced by flat capacity growth year-on-year in October, after a rise of 2% in September. With volumes still outpacing supply, Xeneta’s dynamic load factor (its measurement of capacity utilisation based on the volume and weight of cargo flown alongside available capacity) rose two percentage points year-on-year to 63%.

On the transpacific, AI-related shipments continue to underpin demand. Chargeable weight from Asia Pacific to North America was around 15% higher year-on-year in October, with freighter capacity on the corridor on a similar growth path.

The outlook for ocean freight remained uncertain. Scheduled container shipping capacity crossing the Red Sea reached around half of its pre-crisis level in October, according to Xeneta ocean data.

“Just over half of Asia–Europe capacity is now routed via the Suez Canal in at least one direction, with around a third sailing through both ways,” Xeneta stated.

Xeneta’s analysis of Eurostat data shows how air freight’s share of Asia–Europe trade has moved with ocean schedule reliability.

Air’s share of EU import tonnage from Asia rose from 1.1% in 2023 to 1.7% in 2024, at the height of the Red Sea crisis, as ocean freight schedule reliability from the Far East to North Europe fell from 28% to 9.3%.

When reliability recovered to 20% in 2025, air’s share fell back to 1.2%. In the first eight months of 2026, it edged up to 1.3%, after the closure of the Strait of Hormuz in February led carriers to shelve their planned return to the Suez Canal.

Xeneta expects cargo that moved to air for reliability rather than speed to start returning to ocean once schedule reliability shows a sustained recovery.

Looking ahead, Xeneta expects air freight rates to decline.

Many shippers avoid negotiating in the busy fourth quarter and are starting tender processes to conclude in the first or second quarter of 2027.

“Forwarders can, of course, offer shippers 12-month deals but, given the market conditions, they would have to bake in so much uncertainty the price becomes uncompetitive,” Mr van de Wouw said.

“In the past couple of years, it has not been the level of demand that caused the uptick in rates; it has been the availability of capacity.

“If the Middle East situation recovers, there will be a rebalancing of demand and supply and rates will then become lower. But things will happen.”