Shanghai spot rates drop signals air cargo e-com volume future: Xeneta

Even allowing for the earlier Lunar New Year and the seasonal e-commerce slowdown at the start of the year, the fall in Shanghai-US spot rates following the temporary US removal of the de minimis exemption on Chinese shipments may be one of the first indicators that “the regulatory/political conversations are starting to affect the air cargo market,” according to Niall van de Wouw, chief airfreight officer at the Norway-based ocean and air freight rate analytics platform.

“When the e-commerce boom took off, it very quickly clogged up the Hong Kong and southern China market because of so much outbound demand. So, the e-commerce market started to venture eastwards to Shanghai, even though it was less desirable due to additional cost,” he explained.

“If a fall in e-commerce volumes means there’s currently more available capacity to do business out of Hong Kong and southern China again, we would expect Shanghai to be the first market to feel this impact, and that’s what we saw in February. This may be short-term, but the uncertainty around e-commerce is impacting the market,” he added.

In comparison, the Shanghai-to-Europe spot rate saw only a modest 2-per cent MoM decline to $3.86 per kg.

Overall, global air cargo demand grew by 4 per cent year on year (YoY) in February, marking a continued slowdown from the double-digit growth seen in every month last year.

By calibrating the earlier Lunar New Year this year, the combined air cargo demand for January and February rose by a modest 3 per cent YoY.

Supply of global air cargo capacity in February also stayed flat YoY. The combined January and February capacity edged up by just 1 per cent, while the dynamic load factor for the first two months this year remained unchanged from a year ago at 59 per cent in February, a Xeneta release said.

Dynamic load factor is Xeneta’s measurement of capacity utilisation based on volume and weight of cargo flown alongside available capacity.

The global air cargo spot rate (valid for up to one month) in February increased at its slowest pace YoY since June 2024, rising by 10 per cent to $2.53 per kg.

In contrast, the global seasonal rate (valid for longer than one month) dropped by 1 per cent YoY to $2.21 per kg, reflecting the market’s changing supply-demand dynamics, Xeneta noted.

The global air cargo spot rate declined 5 per cent MoM.

Among the major global corridors, the Northeast Asia to Europe market saw a 10-per cent rise YoY to $4.32 per kg, but fell by 2 per cent MoM, while Northeast Asia to North America spot rates experienced the steepest MoM decline, dropping by 17 per cent to $3.79 per kg.

Meanwhile, the Transatlantic market remained buoyant. Spot rates from Europe to both Latin America and North America recorded high single-digit growth MoM, maintaining levels over 20 per cent higher than a year ago.

ALCHEMPro News Desk (DS)