AIR cargo volumes rose 10 per cent year on year in January, but this hasn't resulted in higher rates due to the availability of capacity, reports London's Air Cargo News.
Shippers' concerns about Red Sea-Suez Canal supply chain delays, plus an early Lunar New Year, have pushed up air cargo volumes, although spot rates have declined, according to the latest market analysis by Xeneta.
"With plenty of available air cargo capacity in what is traditionally a quieter month for demand, however, fuller cargo holds are yet to translate into higher rates," said the ocean and airfreight rate analytics platform.
"Globally, general air cargo spot rates in January declined 12 per cent month on month to an average US$2.27 per kg, consistent with the trend of the global dynamic load factor, which dropped three percentage points to 56 per cent versus December."
Xeneta added: "Compared to the previous year, January's global average spot rate continued to show a double-digit year-over-year decline of 21 per cent, although at a slower pace compared to the 38 per cent decline seen in January 2023."
Some of January's higher air cargo volumes are likely due to some shippers, especially in the apparel industry and producers of manufacturing components, shifting from ocean transport to air due to the need to move goods ahead of the Lunar New Year, said Xeneta.
Niall van de Wouw, Xeneta's chief airfreight officer, predicted that the Red Sea disruption will not result in a longer-term shift to airfreight as shippers will eventually adjust to the situation.
"The situation in the Red Sea has brought nervousness to many supply chains and possibly encouraged some shippers to have a knee-jerk reaction, shifting to airfreight, bringing volumes forward, and securing capacity. However, the consensus seems to be that this will not produce a long-term positive effect on airfreight."
Source: shippingazette