It spiked in late July

According to FREIGHTOS, at the end of July, as container rates began to spike ahead of the peak season, air rates remained stable for three weeks in a row, despite "promotional pricing finally starting to take off."

    "Most of the time, promotions start in the early summer," says the freight digitization expert. That's because airlines are returning bigger planes to Europe and adding more flights to meet growing passenger demand. This has also boosted air cargo capacity, but demand is currently weak.

“There were no promotions earlier this summer - there was no need as capacity was tighter than in previous years. Two weeks ago, however, several major airlines finally started their promotions.

 FREIGHTOS said that on July 26, the general cargo and express rate on the Sino-US route was 2.9-6 US dollars/kg, the price between China and Europe fluctuated between 2.8-6 US dollars/kg, and the price in the European and American markets was 1.6-3 US dollars/kg.

August space squeeze

Freightos said the currency and express rates on the Sino-US route on July 26 ranged from $2.90 to $6 per kg, with prices in Central Europe fluctuating between $2.80 and $6,000 per kg, while prices in the European and US markets ranged from $1.60 to $3.0 per kg.

    The TAC index has more specific pricing details, where the Hong Kong-Europe price reached US $2.88 / kg on July 29, up 5.1% week on week, but the Hong Kong-North America price fell 2.8% to US $3.9 / kg.

In the first week of August, export positions from China were tight and prices slightly higher, while the Hong Kong to the United States route was picking up and there was no significant overstocking.

Rise of Vietnam

   Vietnam exports are already another case, with US freight forwarders advising that "as demand continues to rise, especially in the United States, demand from Vietnam to the East Coast of the United States is particularly high, and for any shipments with strict deadlines, express services are required."。

   Flexport also predicted that Italian prices to the US would rise during the summer holidays in August and claimed that prices for US exports would continue to creep up due to very tight positions to South East Asia and mainland China.

High expectations for air cargo in the second half of the year

    As the strong demand for the next month is expected to continue to decline, air cargo volumes are expected to continue in the second half of the year, so the peak season for air cargo is still expected to be high in the second half of the year.

Although air cargo experienced rapid growth last year, the volume of cargo on most routes continued to grow year-on-year in 2018, and the outlook remains strong despite the potential impact of the US administration's tariff war on world trade.

 Polish your Crystal Ball
   For those airlines active in the US market, another risk to air cargo will also be apparent in the second half of the year, as previously reported by FLITENTYPER, the impact of new electronic detection equipment (ELD) on the shortage of truck drivers continues to affect air cargo companies. Higher freight costs, delays and even modal shifts have negative consequences for air freight.

Capacity constraints in air cargo remain on the minds of forwarders and shippers in 2017, with many looking for a guaranteed lift or leasing their own aircraft, at least in the United States, likely to emerge.

In the fourth quarter, the ability to book in advance was critical。