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China-US air cargo rate could hit US$17 per kg over next few weeks
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Time:2018/1/18 16:12:33 |
CARGO owners who require urgent air cargo shipments from China to the US over the next three weeks could be facing freight rates as high as US$17 per kg as capacity tightens on the major trade routes ahead of the Chinese New Year.
CEO of Freightos WebCargo, Manel Galindo, said most China-US pricing was currently in the $6-7 per kg band, but with the high demand for air cargo continuing to place available capacity under pressure, this was sure to increase in the run up to the Lunar New Year on February 16.
"At this point, I'd predict prices to jump to $10-12/kg as we get closer to Chinese New Year, with urgent shipments facing prices in the $10-$17 bracket," Mr Galindo said.
Much of the growth in the air freight market has been driven by e-commerce, which is being regarded as a long-term trend. The rapid growth of e-commerce in 2017 led to traditional shippers of air freight, as well as emergency shipments, all competing for limited space, according to IHS Media.
Flexport COO, Sanne Manders, said the growth of e-commerce sparked air freight capacity shortages on core trade lanes and drove air freight rates to record highs. After years of having to eke out a living on wafer thin margins, carriers are expected to try to hold on to their new-found profitability.
"The space constraints have made the spot market so much more profitable than block space that we expect airlines to hold the line on capacity growth and block space allocation, especially on the trans-Pacific, in order to maintain yields from Q4 into 2018," he said.
To ensure capacity on the routes where space is most constrained, Flexport will begin regular 747F charter flights from Hong Kong to the US West Coast in this first quarter.
Chairman of The International Air Cargo Association Sebastiaan Scholte, said airline load factors and yields have improved and air cargo revenue in 2017 rose by 15 per cent compared with the previous year. Revenue is expected to grow by an additional nine per cent in 2018. | | | | | | | |
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