Global airfreight volumes declined in the first full week of August after a mild rally the previous week, with chargeable weight sinking from all origins, while pricing and capacity inched lower, barely changing from the previous week.
The latest figures from WorldACD Market Data show a -4% drop in global tonnage in week 32 (3 to 9 August) compared with the prior week, with single-digit percentage contraction out of all origins. Volume fell -6% out of the Middle East and South Asia (MESA), followed by contraction of -4% from Europe and North America. Tonnage from Asia Pacific slipped -3% week-on-week (WoW), while Africa and Central & South America (CSA) registered -2% declines.
Weekly tonnage fluctuates in a narrow band
WorldACD statistics show that traffic kept fluctuating WoW over the past four weeks within a narrow band, alternating between contraction and growth. Year on year (YoY) global traffic expanded +1% in week 32, with gains of +1% or +2% out of all origins except Europe, which shows a slip of -1%.
Comparing the last two weeks with the prior fortnight (2Wo2W), total chargeable weight decreased by -1%, pulled down by contraction of -2% from Asia Pacific and -3% from North America, while MESA and Europe showed +1% growth and traffic was flat out of CSA and Africa. Traffic out of Asia Pacific declined on lanes to Europe and North America as well as within the region, only expanding +1% to MESA. North America registered -6% decline to Asia Pacific and -5% to Europe but a +2% gain to CSA. European exports grew +3% to North America and MESA but dropped -1% to Asia Pacific and
Africa, remaining unchanged to CSA.
Headwinds for Asian exports
Volumes from Asia Pacific fell -4% WoW both to Europe and USA, with decreases out of most origins except Japan, which saw chargeable weight to USA jump +12% and +3% to Europe. Except for Malaysia (+4%), tonnage from other Asian origins to USA declined, led by drops of -11% from Taiwan and -10% from Indonesia. The latter also led WoW tonnage decline to Europe (-18%), followed by Taiwan (-14%) and Malaysia (-12%).
Traffic out of Asia Pacific, notably from China, was affected by Typhoon Dolphin, which caused evacuations in Shanghai as well as Beijing and over 1,000 flight cancellations in Shanghai alone. It also caused delays at the port of Shanghai and other Chinese maritime gateways, which may trigger shifts of some exports from ocean to airfreight. Under the impact of the typhoon, chargeable weight out of Shanghai fell -8% WoW overall, with declines of -4% to North America, -7% to Europe and -12% intra-Asia Pacific.
Chargeable weight out of China fell -5%, under the impact of the typhoon as well as the lingering repercussions of the end of the ‘de minimis’ exemption for e-commerce entering the European Union, which shows in a -8% YoY drop in chargeable weight from China mainland to Europe, and even -29% from Hong Kong to Europe.
Traffic from MESA to Europe fell -11% WoW, with chargeable weight dropping from all origins in the region by mid-to-high single-digit percentages with the exception of Sri Lanka, which showed a surge of +15%. On a year on year basis, traffic in this lane is down -13%, due to declines of -62% from Dubai and -4% from India. MESA exports to the USA decreased -1%, owing to declines of -23% from Colombo and -8% from India, which cancelled out gains from Dubai (+37%) and Bangladesh (+15%).
Pricing retreats in stable capacity environment
Global airfreight capacity sank -1% WoW on a -1% contraction out of Asia Pacific, MESA and North America. It was flat out of Europe and CSA and expanded +1% from Africa. Capacity has been relatively stable since Week 27 (29 June to 5 July), when it was flat, followed by shifts of +1% or -1% throughout the subsequent weeks, with low single-digit shifts in the individual regions.
Driven largely by lower fuel costs, pricing has eased in recent weeks, retreating from a global average rate of $3.00 in Week 29. It slipped marginally WoW from $2.96 in Week 31 to $2.95. Rates inched up +1% WoW out of Europe but were flat out of Asia Pacific, CSA and North America, while they were down -1% from MESA and dropped -5% from Africa. Year on year pricing was up +22% overall, showing increases between +8% (from CSA) and +48% (MESA).
Spot rates from Asia Pacific to Europe increased +1% WoW, driven by increases of +6% from China and +3% from Hong Kong, which compensated for declines from elsewhere in the region, led by South Korea (-6%), Singapore (-5%), Taiwan (-4%) and Japan (-4%). Spot rates from Asia Pacific to USA declined -3%, falling in single-digit percentages out of all origins except Hong Kong (+3%), Thailand (+1%) and Vietnam (0%).
The rise of Europe-bound pricing out of Hong Kong and China despite the end of the European de minimis exemption and the decline of transpacific rates out of Asia Pacific suggest that freighter capacity previously deployed for e-commerce transport to Europe has shifted elsewhere, with the transpacific sector the obvious target, as per the WorldACD analysis.