Air cargo rates hold at $3.55/kg as Golden Week trims demand

Global spot air cargo rates held at US$3.55 per kilogram in week 41, even as chargeable weight fell for a third straight week and capacity across Gulf markets sat 20% below its late-February level, WorldACD Market Data reported.

Worldwide chargeable weight dropped 1% week on week in the week ending 11 October. That's the third consecutive weekly decline. Yet the underlying market is far from weak: global tonnage still ran 9% higher than a year earlier. Full-market rates, combining spot and contract shipments, stayed at US$3.13 per kilogram — up 29% year on year, while spot rates gained 34%.

What drove the dip?

China's Golden Week holiday did most of the damage, with national holidays in Taiwan and South Korea adding to it. Tonnage from Asia-Pacific origins fell 1% week on week, after declines in the previous two weeks. Combined volumes across weeks 40 and 41 came in 7% lower than the prior two-week period.

The seasonal pattern itself is routine. The backdrop is not. WorldACD flagged that this year's comparisons are distorted by changing trade policies, import-rule changes in Europe and geopolitical disruption, which makes year-on-year readings harder to read in isolation.

Regional spot pricing split sharply:

• Asia-Pacific origins: down 3% week on week to US$4.83 per kilogram
• Middle East and South Asia origins: down 2%
• Africa: up 10%, offsetting some of the weakness elsewhere

Why is Gulf capacity under pressure?

Global air cargo capacity contracted 1% for a second consecutive week. Asia-Pacific and the Middle East & South Asia each lost 3%.

The Middle East squeeze stems partly from renewed disruption in Saudi Arabia after attacks by Yemen's Houthis on several Saudi airports, including Riyadh's King Khalid International Airport. Capacity from Gulf markets fell 4% week on week in week 41, wiping out the previous week's increase.

The longer arc is starker. Compared with late February — before the US and Israel attacked Iran — Gulf capacity is down 20%. That gap shows how geopolitics can strip out lift independently of what demand is doing.

What does this change for shippers and forwarders?

Stable headline rates don't mean normal conditions. Jet fuel prices were 111% higher year on year, according to IATA and Platts data cited by WorldACD, feeding through fuel surcharges and layered on top of capacity disruption in selected markets. Actual pricing will keep varying by trade lane, service type and contract terms.

For airlines, forwarders and cargo owners, the immediate task is telling a temporary seasonal slowdown apart from persistent constraints on capacity and cost. October's numbers suggest demand remains stronger than a year ago, but the balance between available lift, fuel expenses and geopolitical risk keeps shaping the market.

WorldACD expects Asia-Pacific capacity to recover now the early-October holidays have ended. The outlook for Gulf services is less certain, with further disruption possible amid renewed regional tensions.