Airfreight rates may have peaked following the Middle East conflict after they increased by more than 30% year on year in April, according to data provider Xeneta.
The latest monthly figures from Xeneta show that last month airfreight demand was up 2% year on year, capacity declined by 1% and the dynamic cargo load factor increased by three percentage points to 62%.
However, the standout figure for the month was the 30% year-on-year increase in average spot prices to $3.34 per kg.
The increase reflected the conflict in the Middle East, which pushed up the cost of jet fuel, resulted in the reconfiguration of supply chains with more direct flying, pushed up transit times as carriers had further to fly and put pressure on capacity.
However, Xeneta said the worst could be over for shippers as capacity returns on the routes most affected by the conflict and market fundamentals “start to regain control of airfreight pricing”.
“Now capacity is coming back, rates will come down, but not as quickly as they went up,” said Xeneta chief airfreight officer Niall van de Wouw. “Ultimately, market fundamentals will prevail.”
He added that freight rates don’t necessarily need to increase just because jet fuel prices have risen.
“Recent developments regarding Transatlantic prices are a case in point. These rates have declined in recent weeks, despite the jump in jet fuel prices.
“The all-in cost a freight forwarder pays an airline is more driven by demand and supply than it is by fuel costs. We’ve been advising shippers not to have a fuel charge in their pricing mechanism, even though we hear that many surcharges are negotiable,” he said.
Van de Wouw also felt that air cargo would escape largely unscathed from airline moves to cut routes in light of the increased cost of fuel.
He explained that long-haul routes – which carry the most cargo – were less likely to face cuts than domestic or regional flights.
Xeneta figures show that rates on certain routes are already starting to fall. South Asia rates appear to have peaked in the week ending 12 April and edged down by single digits in the final week of April, the data firm said.
Southeast Asia corridors have followed, if less dramatically: Spot rates from the region to the Middle East and Europe rose 43% and 61% from the pre-Iran conflict levels to $3.78 and $5.12 per kg, respectively, while rates to North America climbed 33% to $6.46 per kg.
However: “Europe and North America-bound rates from the region now appear to be plateauing, though Middle East rates have yet to stabilise.”
Northeast Asia lagged its neighbours with outbound rates to the Middle East, Europe, and North America reaching “new highs of $5.25, $5.63, and $5.54 per kg respectively in the week ending 26 April”.
However, Xeneta added that percentage increases from this region “remained modest” compared with South and Southeast Asia.
“The lag likely reflects the delayed pass-through of jet fuel surcharges, which track actual fuel price movements with a delay; spot fuel prices themselves peaked in early April,” Xeneta said.
While rate growth from Asia is either slowing or plateauing, prices from Europe to North America fell 17% compared with pre-conflict levels to $2.57 per kg.
“Despite rising jet fuel prices, airlines switching to summer schedules have flooded the corridor with additional passenger belly capacity, pushing cargo load factors down ten percentage points month-on-month and dragging rates with them,” Xeneta said.
Market outlook
For the rest of the year, van de Wouw is expecting a tough period due to rising inflation and concerning figures showing a 9% year-on-year fall in e-commerce volumes out of China in March.
Some of this volume may have shifted into air freight consolidations and, therefore, be excluded from this data, van de Wouw said but added the downward trend seen over the last four months ex-China indicates that, for airfreight demand, “the B2C e-commerce growth seems to be over”.
“Everything that has happened in the last few weeks was against a backdrop of a not-too-rosy outlook for 2026,” he said.
“Overall, we do think we have seen the peak for global airfreight rates, and we expect them to go down on more lanes, but, based on recent experience, there will undoubtedly be an underlying concern about what’s next in terms of trade disruption.”
