Global airfreight rates edged lower following China’s Golden Week holiday, but the market remainssignificantly more expensive than ayear ago as shippers prepare for the year-end peak season.Data from TAC Index show that the Baltic Air Freight Index (BAI00) declinedby 2.1% in the sevendays to 12 October, while remaining 24.3% above its level a year earlier.
The latest figures point to an uneven market, with rates easing on major China-origin routes whilesome services from Hong Kong and SouthKorea recorded increases. At the same time, higher aviationfuel costs, geopolitical disruption and competition for capacity are addinguncertainty to freightprocurement ahead of the Northern Hemisphere’s winter shipping season.
Golden Week, China’s annual National Day holiday period, typically brings factory closures and atemporary slowdown in export activity. Thelatest decline in the global index is consistent with thatseasonal pattern, but industry sources cited by TAC Index indicate that underlyingmarket conditionsremain firm.
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AI Infrastructure Demand Adds to Capacity Pressure
Demand associated with artificial intelligence infrastructure is emerging as a potential source ofadditional pressure on airfreight capacity.Large cloud computing providers, commonly referred toas AI hyperscalers, are expanding data-centre infrastructure and require shipmentsof high-valuetechnology equipment and components.
According to TAC Index’s market commentary, some hyperscalers have yet to secure all the capacitythey anticipate needing for the peakseason. Meanwhile, other e-commerce businesses and shipperspreparing product launches have already booked space, setting the stagefor greater competitionif additional demand materialises.
Kelly Martinez, president of ePost Global, described the current environment as particularly challenging,pointing to unusually high peak-season surcharges and their early introduction.
The combination of technology-related shipments, e-commerce demand and traditional year-endretail replenishment could place furtherpressure on capacity. However, the extent of any additionalrate increases will depend on actual shipment volumes, available aircraft capacityand how quicklydemand builds after the holiday slowdown.
China Rates Dip as Fuel Costs Surge
Airfreight rates from China to Europe and the United States declined week on week, while aviationfuel costs remained a significant concernfor airlines and logistics providers. TAC Index cited theInternational Air Transport Association’s (IATA) Jet Fuel Price Monitor, reportingthat jet fuel priceswere 111.2% higher year on year.
The increase adds pressure to operating costs as carriers and freight intermediaries contend withcontinued disruption in the Middle East.Fuel expenses can feed into freight rates and peak-seasonsurcharges, although the extent and timing of any pass-through vary by carrier,route andcommercial agreement.
The softer pricing on China-origin routes did not extend across the wider Asian market. TAC Indexreported that the full index of outboundHong Kong routes increased by 0.2% week on week, whilerates from Shanghai declined by 2.1%. Rates from India also eased, and Asia–Europe pricing remainedcomparatively weaker than intra-Asia and transpacific services.
These differences underline the fragmented nature of the current market: aggregate global ratesmay decline even as selected originsand trade lanes face rising costs or tighter capacity.
European Outbound Rates Strengthen
European-origin airfreight rates generally increased during the reporting week, with gains on transatlanticservices to the United States androutes to China, India, Australia and South Africa. Market sourcescited by TAC Index also reported increased Europe–US transhipment activity.
At airport level, the index for Frankfurt rose by 3% week on week, while London Heathrow recordeda stronger 12.1% increase. Routesfrom Europe to Japan, Mexico and the United Arab Emirates,however, registered declines.
TAC Index also reported disruptions affecting routing options in Saudi Arabia following attackson aviation infrastructure. The specific claimthat hundreds of flights had been cancelled at KingKhalid International Airport in Riyadh was not independently corroborated in the sourcesreviewedand should be treated as unverified pending confirmation from the airport or relevant authorities.
North American Markets Show Mixed Performance
North American airfreight rates varied by destination, with week-on-week increases on routes toSouth America led by stronger southboundservices from Miami International Airport. Rates onselected transatlantic routes also showed gains, while services from North Americato the UK, Chinaand South Korea weakened.
Outbound rates from Chicago fell by 29% week on week following earlier substantial increases,with particularly sharp declines on Asianroutes. Rates from Mexico to Europe also dropped. Despitethese corrections, both markets remained well above year-earlier levels, accordingto TAC Index.
The divergence between regional markets reinforces the importance of route-specific planning asthe industry enters its busiest shippingperiod. Shippers relying on major Asian export gateways,transatlantic services or time-sensitive technology shipments may face substantiallydifferent pricingand availability conditions depending on origin, destination and booking lead time.
Outlook: Capacity Planning Becomes Critical
The latest data suggest that the post-holiday easing in global rates has not fundamentally changedthe outlook for the fourth-quarter peakseason. With the global index still 24.3% above its year-earlier level, fuel costs elevated and some large buyers yet to finalise their capacityrequirements,further volatility remains possible.
For freight forwarders and shippers, securing allocations early, diversifying routing options andmonitoring surcharges will be importantto managing exposure to rising costs. However, a sustainedincrease in rates is not guaranteed: the direction of the market will dependon how demand developsagainst available capacity in the weeks ahead.
