Drewry suggests modest July recovery in air cargo prices

Airfreight rates have recovered slightly since this May’s dismal numbers, according to the latest East-West Air Freight Price Index from Drewry. Rates rose 1 index point between June and July, to reach 86.8 points.

July’s index shows airfreight prices rising to US$2.82 per kilogram, compared with $2.78 per kilogram a month earlier. Over the last year, rates peaked in October 2015, at $3.24 per kilogram.

While the improved numbers are good news to carriers, freight prices are expected to remain under pressure well into the future as more passenger aircraft enter service, bringing cheaper bellyhold capacity online. “The latest reading still signified the lowest July level since the index first launched in 2012, providing a reminder of the general weakness of the market,” Drewry said.

Prices are also now just 1.4 percent behind last year’s level for July, which stood at $2.86 per kilogram. “Higher fuel costs have played a part in driving this recovery, though signs are emerging of a mild strengthening in demand conditions, albeit from a low base,” the report stated.