Trans-Pacific rates, traffic decline early in 2019

Airfreight traffic among Asia-Pacific carriers is on the decline so far in 2019, defying expectations of increased shipments ahead of the Chinese New Year. Meanwhile, while data from the TAC Index, which publishes weekly average general cargo prices on major global origin-destination pairs, indicates that trans-Pacific airfreight rates between Hong Kong and North America have likewise fallen nearly 40 percent from 2018’s peak on Nov. 19 to US$3.42 on March 4, as reported by Lloyd’s Loading List. 

In its traffic results for January, the Association of Asia Pacific Airlines (AAPA) noted that international freight tonne kilometers (FTKs) were down 3.8 percent year-over-year in January. The AAPA attributed weakness in airfreight to “concerns over slower growth in major economies and unresolved trade tensions are affecting air cargo demand.” 

Judging by average airfreight rates this month, there has been no significant improvement in airfreight traffic since January. November received a boost in demand, alongside typical peak season increases, as importers aimed to get ahead of U.S. tariffs scheduled to go into effect in January. However, March lacked that boost as the round of tariff increases originally scheduled for this month have been delayed, thanks to renewed negotiation attempts between the United States and Chinese governments. That leaves retailers some breathing room before they may have to rush additional imports to beat another wave of tariffs. 

Those interested in learning more about trends in Asia-Pacific airfreight are invited to join us at Cargo Facts Asia 2019, to be held 15-17 April at the Langham Shanghai. For more information, or to register, visit www.cargofactsasia.com.