Global air cargo volumes continued to rise in October, increasing 4% year on year—slower than previous months but stronger than analysts had expected, according to the latest data from Xeneta.

The performance came despite a slowdown in businesses frontloading imports to offset tariff costs and the end of the U.S. de minimis exemption, Xeneta reported.

The figures align with the company’s September forecast of 3–4% demand growth for 2025, but analysts warn that market conditions are shifting. “The market is definitely starting to favor shippers more than it has for the past few years,” said Niall van de Wouw, Xeneta’s chief airfreight officer.

October marked the sixth straight month of falling global air cargo spot rates, down 3% year on year to $2.58 per kilogram. Seasonal contract rates, which typically last more than a month, fell even faster—dropping 8% to an average of $2.31 per kilogram—signaling growing caution among freight forwarders and carriers.

Van de Wouw highlighted the Europe–North America corridor as a potential “bellwether for the rest of global trade.” Despite overall global growth, demand on this route declined 6% year on year in October, while spot rates rose just 4%, a sharp slowdown from the 23% annual surge seen earlier in 2025.

“I would have expected global growth to be closer to zero, given last year’s strong Q4 and ongoing trade disruptions,” said van de Wouw. “The numbers were better than anticipated, but the overall trend is clearly one of deceleration—and a 6% drop on the Transatlantic market is a warning sign.”

For the second time this year, air cargo demand lagged behind supply, which rose 5% in October. Across the three major trade lanes, peak-season momentum remained muted.

After adjusting for disruptions caused by Super Typhoon Ragasa and China’s Golden Week, Asia Pacific–Europe volumes in October were up 11% from August—below the 16% gain seen a year earlier. Spot rates on the lane rose 5%, compared with a 9% increase last year.

E-commerce remained a key driver of Asia–Europe volumes as Chinese online retailers expanded aggressively outside the U.S. China Customs data shows low-value and e-commerce exports to Europe surged 62% year on year in September—double last year’s growth rate and well above the nation’s overall e-commerce expansion of 18%.

In contrast, China–U.S. e-commerce shipments declined for the fifth consecutive month, falling 34% in September. The rate of decline, however, has eased from a 49% drop in June.

As freighter capacity shifts from the Transpacific to Asia–Europe routes, spot rates from Northeast Asia to Europe dipped 5% year on year—milder than the double-digit declines seen on Asia–North America lanes. Over the past two months, Northeast and Southeast Asia–Europe routes showed resilience, with spot rates rising 6% and 7% respectively, compared with -3% and +1% changes on their North American counterparts. Backhaul rates from North America to Northeast Asia also rebounded 11%.

Looking ahead, van de Wouw expects only modest, supply-driven rate increases on Transatlantic routes as airlines cut winter capacity. Forwarders, he said, will continue to prioritize cost savings amid disappointing revenues.

“Companies are announcing cost reductions across the board—and that wouldn’t be happening if the outlook were more positive,” he said. “Organic growth won’t satisfy investors, so forwarders will compete harder for market share. When demand is flat, winning business means taking it from someone else, and that pushes rates even lower.”

Van de Wouw added that while lower rates may seem beneficial to shippers, they only help if sales remain strong. “Most shippers would prefer 10% higher freight costs and 10% higher sales over the opposite scenario,” he noted.

Despite temporary boosts from tariff-related disruptions, van de Wouw cautioned that the airfreight industry faces limited long-term growth. “It would be naive to think the tariff situation will end anytime soon,” he said. “But as the noise fades, the market is realizing there’s only so much growth in general freight—and expectations for 2026 are being reset accordingly.”

Source: aircargonews.net