Worldwide chargeable weight declined -1% in week 19 (May 5-11) compared to the previous week, marking a string of contractions since the first week of April that was only interrupted by stable volumes in week 17. The comparison of the last two weeks with the previous two weeks (2Wo2W) shows a worldwide tonnage decline of -3%, with Europe and North America being the only origin regions to see traffic growth of +2% and +3% respectively, partly related to post-Easter recovery for those origins. The end of US ‘de minimis’ exemption of China origin imports worth less than $800 effective May 2 reinforced the global downward trend in airfreight demand, showing a marked weakening of tonnage moving from China to the US.
As a result of weakening demand, the global average rate retreated for a fourth week in a row, dropping from $2.46 in week 15 to $2.34, a -2% decline from week 18. On a 2Wo2W comparison the global average rate was down also -2%, based on over 500,000 weekly transactions covered by WorldACD’s data. This was -3% lower than in week 19 of 2024, showing an increasing gap in year-on-year comparisons. North America and Europe, up +3% and 1% week on week respectively, were the only origin regions to show increases in pricing, partly related to post-‘Labor Day’ (May 1) holiday recovery.
According to the latest figures from WorldACD Market Data, the decline in chargeable weight on a 2Wo2W basis was led by the Asia Pacific region (-8%), followed by Central and South America (CSA), where the end of the flower export spike for Mother’s Day resulted in a -5% drop in volume. Exports from the Middle East and South Asia (MESA) region slipped -1%, likely as a result of the geopolitical tensions in the region, while volume out of Africa was flat. Growth in the westbound transatlantic market, with 2Wo2W chargeable weight up +6%, has been fueled by front-loading during the pause in tariffs. The Asia Pacific region shows 2Wo2W declines in all sectors, with volumes to North America and within the region falling -13% and -12% respectively, reflecting uncertainty over tariffs and a pause in traffic from ‘Labor Day’ (May 1) and ‘Golden Week’ (April 29 – May 6) holidays.
A combination of factors exerted downward pressure on pricing, most prominently uncertainty over US tariffs, which slowed economic activity and caused firms to postpone strategic sourcing and investment decisions. On a 2Wo2W basis pricing declined most notably ex-North America to Asia Pacific (-5%), ex-Asia Pacific to North America (-4%), and ex-Europe to North America and CSA (both -3%). The slump in container shipping pushed down box rates, making airfreight less appealing to shippers. One stabilizing factor was airfreight capacity, which contracted -2% globally 2Wo2W. With the exception of Europe, which registered +1% more lift, all other regions saw capacity decline, led by a -5% drop in the Asia Pacific region (partly due to ‘Golden Week’).
Trade war swings suggest further changes in demand
Already struggling from the impact of the trade war on airfreight flows, demand was further hit by the end of the US ‘de minimis’ exemption, which caused double-digit percentage drops in China origin volumes to the US. In week 19 (May 5-11) chargeable weight from China and Hong Kong to the US fell -10% from week 18 (April 28 – May 4), which had already shown a -14% slump a week earlier (partly due to ‘Labor Day’). Year on year volumes from China and Hong Kong to North America were down -27% in week 19, a fourth week of double-digit percentage decline. By comparison, Asia-Pacific traffic to Europe fared considerably better. Chargeable weight to Europe from China and Hong Kong as well as from Asia Pacific was unchanged from the previous week.
The coming weeks will likely produce another twist in the plot after the unexpectedly swift pause in the China-US trade war, leading to expectations of front-loading that could stretch reduced container shipping capacity. Above all, the 90 days suspension of elevated tariffs has also reduced the duty on China origin parcels to the US, which could trigger a resumption of the use of airfreight for this business. It should be noted, though, that parcels shipped outside postal networks have to undergo customs clearance, adding cost and transit time, which will affect the appeal of using airfreight to ship direct from China to the US.
