Global airfreight rates continued to soften last week, marking a fourth consecutive weekly decline despite renewed geopolitical tensions in the Middle East and a sharp increase in jet fuel prices.
According to the latest data from TAC Index, which calculates the Baltic Air Freight Index (BAI), the global BAI00 index fell 3.1% during the week ending July 20. Despite the recent slowdown, overall airfreight rates remain 17% higher than a year ago, reflecting the market’s resilience in the face of easing demand.
The decline comes as tensions in the Persian Gulf have intensified, while jet fuel prices have surged. Data from Platts, referenced by the IATA Jet Fuel Price Monitor, shows jet fuel prices were 65.9% higher year over year on July 17. However, those higher operating costs have not yet translated into higher freight rates.
Asia’s largest cargo hubs continued to see prices ease. Spot rates from Hong Kong, Shanghai and South Korea all declined during the week, particularly on routes serving Europe and the United States.
The Hong Kong outbound index (BAI30) fell 6.3% week over week, reducing its annual gain to 16.7%. Meanwhile, the Shanghai outbound index (BAI80) slipped 1.1%, though it remained 23.9% above its level a year earlier.
Not every market followed the same trend. Airfreight rates strengthened on several Trans-Pacific routes from Bangkok, Vietnam, Malaysia and South Korea to the United States, reflecting stronger demand on those lanes. India also saw rates begin to recover, particularly on shipments bound for Europe.
Taiwan was one of the few exceptions in Asia. After remaining at elevated levels for much of the past year due to strong semiconductor exports, freight rates from the island declined slightly last week on both European and U.S. routes.
European markets also experienced modest weakness overall. Freight rates from Europe edged lower on major routes to North America and declined on services to Australia, Brazil, Mexico and India. In contrast, rates increased on shipments to China, Japan and South Africa.
The Frankfurt outbound index (BAI20) dropped 5.2% during the week but remained 9.7% higher year over year. At London Heathrow, the outbound index rose 1.2% week over week, although rates were still 6.4% below their level a year ago.
In North America, outbound rates from the United States softened on routes to Europe, the United Kingdom and China, while prices increased slightly on services to South America and South Korea.
The Chicago outbound index (BAI50) rose 2.5% over the week, bringing its annual increase to 29.7%. Freight rates from Mexico to Europe also continued to climb, remaining well above last year’s levels.
Although global airfreight rates have been trending lower in recent weeks, the market remains considerably stronger than it was a year ago. Demand continues to vary by region and trade lane, with stronger Trans-Pacific activity helping support prices even as broader market conditions gradually soften.
