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Steady growth in passenger capacity undermining air freight rate growth
来源：shippingazette 编辑：编辑部 发布：2024/01/04 10:36:25
SEASONAL demand patterns are slowly resuming on major air freight trades and more volumes are flying under fixed-rate agreements, but a combination of lukewarm demand and increases in long-haul passenger services have resulted in an overabundance of capacity.
One exception - at least for now - Is the trans-Pacific trade, where capacity has yet to return at the same pace as on other routes, largely because China only emerged from pandemic lockdowns in January 2023.
In the first half of 2023, the lingering effect of contracted chartered freighter capacity locked in by forwarders during the frantic scramble for space in late 2021 and 2022 exacerbated surplus capacity and faltering spot rates as forwarders sold space at rock bottom prices to fill those aircraft, reports New York's Journal of Commerce.
Even as the freighter charters began to expire, however, the capacity overhang grew as airlines increased flight frequencies to cover the summer surge in passenger travel, a traditional slack period for air cargo. Although spot rates on the major export trades out of Asia tumbled through mid-year, they remained significantly higher than in pre-pandemic 2019, largely a reflection of higher operating costs for airlines.
Volumes and rates began to rebound in the run-up to China's Golden Week in October, particularly on China-US routes, and continued to increase through the end of the year.
Looking ahead: Air freight volumes are not expected to show any significant growth until well into 2024, and some analysts question whether there will even be a peak season for exports from Asia at the end of the year. Demand in air freight hinges on consumer confidence and improving economic activity in the major markets of the US and Europe, both of which continue to be dampened by high interest rates and the rising cost of living.
The latest S&P Global Purchasing Managers' Indices (PMIs), leading indicators of air freight volumes, reveal new factory orders in Southeast Asia and China are slipping as companies battle rising costs and tepid foreign demand. However, certain segments, such as perishables and semiconductors, are bucking the general downward trend in volumes.
One exception - at least for now - Is the trans-Pacific trade, where capacity has yet to return at the same pace as on other routes, largely because China only emerged from pandemic lockdowns in January 2023.
In the first half of 2023, the lingering effect of contracted chartered freighter capacity locked in by forwarders during the frantic scramble for space in late 2021 and 2022 exacerbated surplus capacity and faltering spot rates as forwarders sold space at rock bottom prices to fill those aircraft, reports New York's Journal of Commerce.
Even as the freighter charters began to expire, however, the capacity overhang grew as airlines increased flight frequencies to cover the summer surge in passenger travel, a traditional slack period for air cargo. Although spot rates on the major export trades out of Asia tumbled through mid-year, they remained significantly higher than in pre-pandemic 2019, largely a reflection of higher operating costs for airlines.
Volumes and rates began to rebound in the run-up to China's Golden Week in October, particularly on China-US routes, and continued to increase through the end of the year.
Looking ahead: Air freight volumes are not expected to show any significant growth until well into 2024, and some analysts question whether there will even be a peak season for exports from Asia at the end of the year. Demand in air freight hinges on consumer confidence and improving economic activity in the major markets of the US and Europe, both of which continue to be dampened by high interest rates and the rising cost of living.
The latest S&P Global Purchasing Managers' Indices (PMIs), leading indicators of air freight volumes, reveal new factory orders in Southeast Asia and China are slipping as companies battle rising costs and tepid foreign demand. However, certain segments, such as perishables and semiconductors, are bucking the general downward trend in volumes.