Freight prices soar! Chinese goods dominate the global market!
Sunny Worldwide LogisticsIt is a logistics company with more than 20 years of transportation experience, focusing on markets such as Europe, the United States, Canada, Australia, and Southeast Asia. It is more of a cargo owner than a cargo owner~
E-commerce demand has become the main driving force for the growth of the global air freight market. Two-thirds of China's air freight volume comes from e-commerce business.
Against this backdrop, freighter operators are also taking advantage of high demand to drive up freight rates.
A freight forwarder in Shanghai said: “We are now at the annual peak period for air freight, and freight rates to Europe and the United States this week exceeded the highest point last year.
This is not surprising. The main driving force comes from e-commerce. It is expected that e-commerce cargo will account for two-thirds of the overall air freight volume. "
According to WorldACD data, air freight rates across the global market increased by 2% in the week ending December 1, reaching US.84/kg, setting a new high this year.
Spot freight rates rose by 3%, with Asia Pacific rising by 4% and North America rising by 3%. As the U.S. Thanksgiving holiday ends, capacity is beginning to stabilize.
WorldACD also noted significant weekly rate increases from select Asian markets such as China, Hong Kong, Taiwan, Japan, South Korea and Vietnam. The details are as follows:
Japan: US.97/kg, a month-on-month increase of 6%
South Korea: US.49/kg, a month-on-month increase of 6%
Vietnam: US.88/kg, a month-on-month increase of 3%
China: US.10/kg, an increase of 7% month-on-month
Hong Kong, China: US.25/kg, a month-on-month increase of 9%
Taiwan, China: US.07/kg, a month-on-month increase of 5%
The freight levels in these markets are all higher than the same period last year, especially Japan and Vietnam, which have a year-on-year increase of more than 30%, and Taiwan, which has a year-on-year increase of 46%.
Although market demand is currently high, industry insiders believe that demand may ease in the short term. "We expect freight rates may fall briefly during the Christmas period, but as the Chinese Spring Festival (January 28) approaches, demand will surge again." ”
However, he also pointed out that freighter operators are taking advantage of future capacity constraints - such as port strikes on the U.S. East Coast and Bay Area, the implementation of new tariffs and large-scale adjustments to flight schedules by shipping companies - to increase contract rates.
He said: "Some of the major freighter operators have made significant increases to annual baggage agreement (BSA) prices in Europe, adding more than .40 per kilogram, which is much higher than 2024 rates. As I remember it, Look, this is a record high over the past many years.”
CargoFacts Consulting analysis said: “It is expected that the tariffs imposed by the United States on Chinese imports in early 2025 will prompt companies to rush to ship goods before the tariffs take effect, which will trigger a surge in demand in the first quarter of 2024.
This wave of demand will put additional pressure on logistics networks, and tight air freight capacity will push freight prices further upward. "
