Global air cargo spot rates continued their gradual decline in August, marking the third consecutive month in which the pace of year-over-year price growth slowed, according to data released by Xeneta.
The global average spot rate reached $3.13 per kilogram in August, representing a 3% decline from July. Although prices remained significantly higher than a year earlier, the annual growth rate has steadily moderated since reaching its peak in May.
According to Xeneta’s Sept. 4 report, August spot rates, which are valid for periods of up to one month, were 24% higher year over year. That compares with a 28% increase in July, 38% in June and a peak annual increase of 41% in May.
Xeneta Chief Airfreight Officer Niall van de Wouw said the market is gradually moving lower on a month-to-month basis, while the difference between current prices and last year’s levels continues to narrow.
“Rates are easing their way down month-on-month, and the gap to last year’s levels is narrowing, perfectly in line with what we expected, and airlines will be hoping to hold on at the current level until the busier season starts,” van de Wouw said.
Shippers seek further reductions
For shippers, however, the decline in rates has not yet gone far enough. Van de Wouw said companies are continuing to push for lower prices because the elevated year-over-year costs are having a significant impact on their budgets.
At the same time, Xeneta is not seeing indications of a major increase in demand in the months ahead. The company expects air freight rates to continue falling, although the decline may not happen as quickly as shippers would prefer.
“It remains a seller’s market,” van de Wouw said.
As they monitor the market, shippers are increasingly purchasing short-term capacity rather than committing further ahead. This strategy allows them to determine whether the month-over-month decline in rates will continue and potentially provide additional financial relief.
Demand nevertheless remains relatively strong. Global air cargo demand increased 6% year over year in August, continuing to grow faster than available supply. At the same time, jet fuel prices have risen in recent weeks, limiting how quickly spot rates can fall.
As a result, Xeneta described the current decline as a descent taking place “in small steps.”
Supply and demand vary by trade lane
Jet fuel costs contributed to the movement in global spot rates, but Xeneta noted that the balance between supply and demand continues to influence individual air cargo corridors differently.
The Transpacific trade lane remains particularly influenced by shipments connected to artificial intelligence. According to Xeneta, AI-related cargo continues to act as a key market driver.
Spot rates from Northeast Asia to North America were 36% higher than late-February levels, while rates from Southeast Asia to North America were 34% higher over the same comparison period.
The situation is different on the Transatlantic corridor. Additional summer belly capacity available on passenger aircraft has helped push spot rates from Europe to North America 25% below late-February levels, according to Xeneta.
Despite that decline compared with late February, the Transatlantic market saw rates increase 2% month over month in August.
The contrasting movements across major trade lanes underline how capacity availability, demand and fuel costs are continuing to shape the air cargo market at corridor level, even as the global rate environment gradually moves lower.
