Air Cargo Rates Hold at $3.13/kg as Golden Week Trims Volumes

Global air cargo rates held firm at US$3.13 per kilo in week 41 (5–11 October) even as worldwide tonnages slipped for a third consecutive week, according to WorldACD Market Data. The full-market figure, combining spot and contract rates, matched the prior week, while global spot rates stayed flat at US$3.55 per kilo. Global tonnage remained 9 percent higher than the same week last year, extending September's identical growth rate into October.

The weekly volume decline traces mainly to China's Golden Week mid-autumn holiday, with smaller contributions from national holidays in Taiwan and South Korea. For shippers and forwarders, the takeaway is a market that has absorbed a seasonal demand dip without conceding pricing ground — a sign of how tight capacity remains on key lanes.

How did the holiday hit Asia Pacific volumes?

Chargeable weight from Asia Pacific origins fell 1 percent week on week in week 41, on top of a 2 percent drop the previous week and a 6 percent fall in week 39 as Golden Week approached. Combined tonnages from Asia Pacific origins across weeks 40 and 41 came in 7 percent below the prior fortnight — a steeper slide than the 4 percent decline recorded in the equivalent period last year. Spot rates from the region eased 3 percent week on week to US$4.83 per kilo.

Elsewhere, spot rates from Middle East & South Asia origins dipped 2 percent amid continued regional disruption, while Africa bucked the trend with a 10 percent weekly jump. Worldwide tonnages fell 1 percent overall, including a 4 percent drop from Central & South America and a 3 percent decline from North America.

What is driving the year-on-year rate surge?

Full-market rates in week 41 stood 29 percent above the equivalent week last year, with spot rates up 34 percent year on year. Two forces explain the gap: capacity disruption on certain markets since the start of the US-Iran conflict, and jet fuel prices running 111 percent higher than a year ago based on IATA/Platts data, feeding directly into surcharges.

Year-on-year comparisons carry caveats in both directions. This year has brought the US-Iran war and changes to European import rules since July; last year saw rapid shifts in US tariffs and trade policy plus the end of US de minimis import exemptions.

Where is capacity contracting?

Total worldwide capacity contracted 1 percent in week 41 for a second straight week, led by 3 percent reductions from both Asia Pacific and Middle East & South Asia origins. The Middle East figure reflects renewed disruption, most notably in Saudi Arabia after attacks by Yemen's Houthis on several of the Kingdom's airports, with Riyadh's King Khalid International Airport hit in particular. Gulf markets had recorded a 4 percent capacity increase in week 40, only to give it all back with a 4 percent decline in week 41. That leaves Gulf capacity down 20 percent from its level in late February (week 7), just before the US and Israel attacked Iran.

Against last year, total global capacity was up roughly 1 percent in week 41, split almost evenly between freighter and passenger bellyhold capacity.

What comes next?

Capacity from Asia Pacific markets should return this week as the east Asian national holidays end, restoring freighter schedules and bellyhold space out of the region's gateways. The Gulf is a harder call: the renewed conflict between Saudi Arabia and the Houthis points to further disruption to already-stretched capacity and services to, from and within the region, keeping upward pressure on rates and surcharges into November.