TAC Index Highlights Increase in Air Freight Rates across Major Lanes

According to their findings, the Baltic Air Freight Index rose by 4.1% in the week ending March 18 2024, marking the third consecutive weekly increase and bringing the decline over the past year down to 20.3%.

The resurgence has been particularly noticed in China, where outbound routes from Hong Kong witnessed a remarkable uptick of 5.2% week-over-week (WoW), with gains registered across nearly all major lanes. This surge has substantially narrowed the year-on-year (YoY) decline to a mere 7.9%, underscoring the robust demand for Chinese exports.

Shanghai, another critical hub, witnessed a formidable WoW increase of 8.9%, fuelled by burgeoning demand in Europe and the United States. As a result the YoY decreases to 7.6%. However, in a slight departure from this trend, rates out of India appear to be stabilizing, while those from Vietnam are experiencing a modest downturn.

The situation in India presents a slightly different picture. While rates from India had been experiencing substantial gains, recent data suggests that they may be leveling off. This indicates a potential stabilization of the market in India, albeit at a high level. Conversely, rates from Vietnam have seen a slight decrease, highlighting the dynamic nature of air freight markets in the region.

Conversely, in Europe, the outbound route from Frankfurt experienced a marginal retreat of 4.1% WoW, primarily attributed to declining rates bound for North America. This adjustment has resulted in a YoY change of -33.1%. Meanwhile, London witnessed a robust WoW gain of 10.6%, with rates surging across all major lanes, consequently mitigating the YoY decline to 42.4%.

Across the Atlantic, outbound Chicago witnessed its second consecutive weekly decline, with rates plummeting by 7.7%, pushing its YoY decline to a whopping 48.5%. Notably, rates from North America exhibited a WoW decline in shipments to both Europe and China, albeit continuing their ascent toward South America.

The fluctuating trends observed across various regions underscore the intricate interplay of factors shaping the global air freight landscape. China’s resurgence hints at a robust revival driven on the back of strong demand. Amidst these fluctuations, stakeholders in the air freight industry remain vigilant, navigating the terrain with agility and foresight.

Furthermore, the insights provided by the TAC Index offer valuable information for stakeholders in the air freight industry, enabling them to make informed decisions in an ever-changing market landscape.