News / Air rates and volumes still volatile – but carriers stay bullish

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Air cargo rates and volumes showed volatile ups and downs in April and May, as the shocks from US tariffs and de minimis changes rippled through supply chains – but carriers are bullish for the rest of the year.  

According to WorldACD, worldwide air cargo tonnages bounced back in May, with a 4% month-on-month increase, after falling 7% in April from March following significant US tariff rises. 

Year-on-year growth for May also stood at 4%, led by increases in volumes from Asia Pacific of 7%, Europe of 4% and Central and South America of 3%. 

“May proved to be another highly volatile month for air cargo,” said the data company.  

It noted that a number of significant national holidays in May, the ending, on 2 May, of de minimis exemptions for goods below $800 from China, and steep rises in US tariffs on China-origin goods all contributed to a slump in transpacific traffic in late April that continued in the first half of May.  

“But the interim agreement on 12 May between the US and China – which included cancelling some tariffs altogether, suspending others for 90 days, and a partial softening of the de minimis changes – stimulated a strong rebound in traffic from China and Hong Kong to the US in the second half of the month,” added World ACD. 

“Capacity trends are diverging. After early May saw nearly 50 freighters grounded and 40% of transpacific capacity withdrawn, week 20 saw a partial recovery, particularly on Asia-US and Asia-Europe lanes,” says today’s Baltic Airfreight Index. 

Indeed, Roger Samways, VP of commercial at American Airlines, told The Loadstar on the side lines of the Air Cargo Europe conference in Munich this week: “The de minimis rule has obviously impacted significantly ecommerce volumes from China to the US… the impact to individual carriers is, to a certain extent, driven by the amount of ecommerce they move. 

“As the de minimis changes were initially implemented back in early May, you saw an immediate reduction in ecommerce volumes. As a result of that, some of the freighters that were operating on the transpacific, specifically to carry ecommerce, began to move to other parts of the world. And so, it’s beginning to change the supply-demand balance in some other markets,” he added.  

The Baltic Index newsletter explains: “Many are testing new lanes in Latin America, the Middle East, and within Asia to absorb parked capacity.”

Average rates in May – based on World ACD’s full-market average of spot rates and contract rates – were 4% down on the previous month, and 3% down on the previous year.  

“That is the first full month since April 2024 in which average worldwide rates have been lower than last year, based on the more than two million monthly transactions covered by WorldACD’s data,” it said.  

Zooming in: from 26 May to 1 June, worldwide flown chargeable weight was down 8% compared with the previous week; the biggest weekly declines were 13% from North America and 11% from Europe.  

Despite the global drop in tonnage for week 22, full-market average worldwide rates rose 3% on the previous week, to $2.44 per kg. This was led by a 3% rise from Asia Pacific, where average spot rates rose 4%, to $3.68. 

Looking ahead, carriers are expecting rates and volumes to trend upwards as “the level of uncertainty results in surges”, according to Richard Forson, CEO of Cargolux. 

“I’m a lot more bullish about the rest of this year than I was at the end of 2024 coming into 2025,” he told The Loadstar. 

Head of cargo at Qatar Airways Mark Drusch added: “I actually think after this is all resolved, there will be a very strong resurgence to catch up on we’ve missed over the past 90, 120 days, however long it takes. 

“It’s not just China-US, it’s put a crimp on everything. And I think once it gets settled, you’ll see everything go back; not only to normal, there’s that pent-up demand that you’ll have to satisfy.”