Air cargo prices and tonnages have stabilized in the past two weeks after dropping sharply in early October, but there are still no signs of a significant fourth-quarter (Q4) peak season, the latest figures from WorldACD Market Data reveal.

In week 42 (October 17 - 23), worldwide chargeable weight slightly decreased (-1%) after recovering +3% the previous week, following an -8% drop in the first full week of October. Comparing weeks 41 and 42 with the preceding two weeks (2Wo2W), tonnages were -2% below their level in weeks 39 and 40, while average worldwide rates were stable, in a flat capacity environment – based on the more than 350,000 weekly transactions covered by WorldACD’s data.

Across that two-week period, tonnages from all the main global origin regions decreased, except for outbound Asia Pacific, which saw a slight recovery (+2%). That may reflect a bounce-back from China’s Golden Week holiday in the first week of October, plus the reopening of some markets – including Hong Kong – following recent Covid restrictions.

On a lane-by-lane basis, tonnages between North America and Europe dropped -4% in both directions, while an increase was recorded from Asia Pacific to, respectively, North America (+3%) and Europe (+2%). Europe-Africa recorded the biggest drop in tonnages, declining -8% southbound and -6% northbound.

Meanwhile, traffic from the Middle East & South Asia to Asia Pacific recorded both the highest increase in tonnages (+7%) and the greatest drop in prices (-13%). That lane has seen an influx of capacity since Russia’s invasion of Ukraine began in February, with the closure of Russian airspace to many airlines leading to some Asia-Europe cargo and services routed instead via the Middle East.

On the pricing side, average rates stabilized for each of the main origin regions except for the Middle East & South Asia (-5%). On a lane-by lane basis, most of the other main trades saw relatively flat pricing, exceptions being a strong increase from North America to Asia Pacific (+7%) and a steep drop in intra-Asia Pacific rates (-10%), on a 2Wo2W basis.

Year-on-Year perspective

Comparing the overall global market with this time last year, chargeable weight in weeks 41 and 42 was down -16% compared with the equivalent period in 2021, despite a capacity increase of +4%. Notably, tonnages ex-Asia Pacific are -23% below their strong levels this time last year, and Middle East & South Asia origin tonnages are -22% below last year.

Capacity from all of the main origin regions, with the exception of Asia Pacific (-8%) and Central & South America (-5%), is significantly above its levels this time last year, including a double-digit percentage rise from Africa (+13%), and outbound Europe and North America (both +9%).

Worldwide rates are currently -17% below their level this time last year at an average of US$3.36 per kilo, despite the effects of higher fuel surcharges, but significantly above pre-Covid levels.

A combination of weaker consumer confidence in certain key markets and earlier-than-normal shipping of stock by retailers and other customers has led to relatively subdued air freight demand this quarter, so far – and lowered expectations of any major winter peak season.