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The air transport market is turbulent, and freight rates have risen sharply! But beware of possible "crash" | Export logistics
Apr 07,2025
Recently, the global air transport market has been riding a roller coaster, with freight rates soaring, and the reasons behind it are complex, making the entire industry nervous.
Amid the clouds of a trade war and rumours of the elimination of the minimum tax exemption in the United States, shipping lines have embarked on a race against time, racing against each other to scoop up cargo for fear of being "cut in the knife" by the new policy.
This trend has directly contributed to the continued rise in air freight rates, which have soared in the past few weeks, and the cost of transport has remained stubbornly high despite market volatility.
The data is most telling. From the TAC Index, the Baltic Air Freight Index Strongly rising 7.1 percent in the four weeks to March 31, a year-on-year increase of 5.1 percent, easily surpassing last year's peak in freight prices driven by the e-commerce boom.
Neil Wilson, editor of TAC, tells the story: At the moment, high freight rates and lower fuel costs are combining, and the profit margins of airlines are quietly stretched.
In the last two or three weeks, a lot of goods have been rushing out of China, aiming to clear customs ahead of new tariffs in America. The outbound routes of Hong Kong and Shanghai became the main forces of this "big migration," rising 6.3 percent and 11.9 percent, respectively, and the Shanghai route grew by a staggering 3.4 percent year-on-year.
However, Wilson also issued a warning: once the new tariff policy takes effect on April 2, the trade volume will "dive," and the freight will fall.
In fact, acute industry insiders have detected that spot prices have quietly eased this week, and there is a lot of mystery as to whether this will be a blip or a sustained decline. Everyone is waiting to see whether this is a blimp or a continued decline.
To add insult to injury, the head of research at Freightos revealed another spoiler: On May 2, the United States will eliminate the minimum tax exemption for Chinese imports, undoubtedly adding another fire to the powder keg for the air transport market.
Multiple reports show that China-U.S. flight service agreements (BSAs) have been cancelled, charter flights have been pulled out, airlines have rushed to relocate capacity to other battlefields, and expectations of declining e-commerce demand have darkened the outlook for air traffic volume.
Expert Levine boldly predicted that in the next few weeks, the air freight market will usher in a wave of "the last madness," and freight rates are expected to rise again; However, with the May 2 deadline approaching, the cargo volume and freight rates on the China-US route are likely to decline in an avalanche.
The reallocated capacity will also create a "butterfly effect" on other routes, driving down overall freight rates.
Brinkley Chan, an industry consultant, also pointed out that although e-commerce is booming globally, China's cost advantage in this field is gradually fading, some capacity has started to shift to Europe, Southeast Asia and other places, and the freight landscape may see a major change as early as May or June.
For the air transport industry, the continued growth of e-commerce demand may be a "life saving straw" for freight rates, which is expected to avoid a complete market collapse. TAC also said that some market trends have become "inertia," even if tariffs, trade barriers variables, will still drive the air market forward in different ways.
In short, the road ahead for the air transport market is uncertain, and with May approaching, the sharp fluctuations in transportation demand will be deeply bound up with freight rates.
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