Air Cargo continues to navigate a challenging landscape with soft demand, capacity increases, and ongoing downward pressure on rates.

The recurring trends will persist through Q3 across all markets and lanes and currently show no signs of notable demand recovery. Although the end-of-year peak might provide a temporary uptick, substantial growth may not be on the horizon before 2024. Meanwhile, as passenger flights resume, ‘Supply’ is seeing a tremendous increase, continuously expanding capacity.

When analyzing market performance based on volumes and rates, the routes that have shown the most promising results are Asia Pacific to Middle East South Asia (MESA), Asia Pacific to Africa, North America to Africa, and North America to MESA. Contrarily, the weaker-performing routes include Asia Pacific to North America, North America to Asia Pacific, and North America to Europe.

Post-pandemic, the transpacific market has experienced a significant boost, but a recent decline is causing a dramatic downturn. The increase in transatlantic passenger capacity, on the other hand, has caused an imbalance between demand and supply.

In terms of shipments, healthcare experienced a 4% increase, while hi-tech goods declined by 15%. E-commerce shipments have risen by 10%, but perishables have dipped by 2%. Significant declines have also been observed in raw materials (-17%), fashion (-16%), and automotive (-13%).

Regarding rate development, yields on the main trades are reported to be closely mirroring 2018/19 levels, with a possibility of further decline due to weak demand and growing capacity.

A return to normal levels is underway after the pandemic-induced boom period for rates, possibly faster than anticipated due to low demand. The upcoming peak season may resemble those seen pre-pandemic, characterized by a seasonal spike in solid demand. Nevertheless, the current sluggish demand coupled with a surplus supply is expected to avert the severe difficulties encountered during the same period in previous years.

The global economic slowdown has led to declining volumes, impacting all operations. The forwarding sector has been particularly hard hit, with air and sea experiencing drops of 19% and 14%, respectively.


  • Analyze and Prioritize Routes: With certain routes showing promising results, shippers should consider concentrating more on these specific lanes. Prioritizing routes such as Asia Pacific to Middle East South Asia (MESA), Asia Pacific to Africa, North America to Africa, and North America to MESA can increase efficiency and profitability.

  • Understand Demand Patterns: Align shipping schedules with sectors that show increased demand, such as healthcare and e-commerce, which have grown by 4% and 10% respectively.

  • Adapt to Market Conditions: Given the global economic slowdown and surplus supply, shippers should focus on enhancing their operational efficiency to remain competitive. This could include improving supply chain transparency or investing in technology to streamline processes.


Last month has seen a mixed bag for freight rates, with a surge in container spot rates from Asia to the US, while carriers have put a halt to the downward trend in short-term rates from Asia to North Europe. However, westbound transatlantic spot rates have taken another hit, with average rates nearing $1,500 per 40ft.

In June, an 18.6% year-on-year volume decrease to 1,747,698 TEU was reported for US container imports at the top 10 US container ports. This reduction, however, marks an improvement from the 20.1% contraction observed in May and April’s 21.6% decrease. According to the forecast, August is expected to signal the end of consecutive double-digit declines. This is because the trade is gradually returning to normal after the surge that followed the pandemic.

Despite the ongoing challenges, some transpacific carriers maintain a degree of optimism, expecting at least a marginal demand increase for the remainder of the peak season.

The Xeneta XSI Asia to US west coast component saw a significant jump of 23% to $1,790 per 40ft, making the average rate increase on this route 40% in July. However, part of this substantial increase might be attributed to the intermittent strike situation at Canadian west coast container ports, which has led to several diversions, blank sailings, and delayed departures of vessels from Asia.

Positive developments were also observed for the US east coast. For instance, Drewry’s WCI Asia to US east coast reading rose 7% to $2,906 per 40ft. Carriers from Asia to North Europe are keeping rates stable with careful capacity management. The FBX North Europe has been around $1,280 per 40ft.

The Asia-Mediterranean trade spot rates are weakening due to increased capacity from vessel upgrades and new services. This week’s WCI Asia-Mediterranean reading decreased by 2% to $1,902 per 40ft. Starting next month, Maersk has declared a rise in its Asia-Med FAK rates, elevating the shipping expenses to certain Mediterranean ports to as much as $3,600 per 40ft.

The transatlantic trade route continues to see a decline in weekly rates, which has caused spot rates to fall significantly below pre-pandemic levels. This week’s WCI average rate for North Europe to the US east coast saw a further 7% drop to $1,640 per 40ft, with rates in the market being offered at $1,300 or even lower.



  • Capitalize on Market Volatility: Given the mixed trends in freight rates, shippers should stay updated on rate fluctuations and strategically plan their operations to take advantage of periods of lower rates.

  • Agile Capacity Management: With the carriers maintaining optimism for demand increase, shippers need to adopt agile capacity management strategies to accommodate such changes and manage costs effectively.

  • Diversify Routes: Shippers could consider diversifying their shipping routes to avoid potential disruptions, such as strikes or diversions, that can impact freight rates and delivery schedules.


The European economy continues to feel the pressure, despite a slight 0.4 percentage point increase in the GDP growth prediction for 2023. Inflation in the euro area continues to decrease, with the annual rate estimated at 5.5% in June, down from 6.9% in March.

Despite diesel prices dropping in Q2 of 2023, the impact on freight rates has been minimal. New legislation could see toll charges on German highways and federal roads doubling from December, likely affecting diesel trucks. Despite improving European road freight market capacity and falling diesel prices, freight rates persist at high levels. The tense economic situation, underscored by declining inflation rates, subdued consumer behavior, and a lack of investment activity, exacerbates the uncertainty.


  • Manage Fuel Costs: Given the potential for toll charges to double and the minimal impact of falling diesel prices on freight rates, shippers should monitor fuel costs closely and consider implementing fuel efficiency measures.

  • Prepare for Economic Fluctuations: Given the economic uncertainty in Europe, shippers should prepare contingency plans to manage potential disruptions. This might include diversifying supply chains, building up safety stocks, or collaborating with partners to share risk.

  • Holiday season in August impacts transit time and capacity in mainland Europe. This makes transit times longer and capacity smaller as some of carriers reduce the number of trucks.


Rail freight traffic through the Channel Tunnel is showing sluggish signs of recovery. In the second quarter of 2023, it recorded a modest 3% year-on-year increase in freight train volumes crossing the Channel Tunnel. However, the overall performance of conventional freight trains and truck shuttles is yet to exhibit encouraging signs.

During Q2 2023, the Channel Tunnel facilitated the passage of 387 freight trains between the UK and mainland Europe. This marks a 3% increase compared to last year’s period, which saw 377 freight trains traverse the tunnel. Despite this marginal uptick, the quarter also witnessed a sharp 23% decline in truck shuttle traffic volumes. Specifically, Q2 2023 saw 302,531 trucks crossing the Channel on trains, a considerable drop from the 391,965 trucks recorded during the same period in 2022.

In another update, TX Logistik, the international branch of Italy’s Ferrovie dello Stato, is set to become Germany’s second-largest rail freight carrier after it acquires Exploris Deutschland Holding. The acquisition will enhance TX Logistik’s east-west European axis traffic, particularly in Poland, and expand its locomotive fleet from 91 to 166. Employee numbers will also nearly double, from 700 to 1,200.

Exploris operates 240 weekly trains, including HSL Logistik Group, Delta Rail, and Via Cargo. These firms extend TX Logistik’s reach into new territories like Poland, the Czech Republic, and Slovakia. They diversify their services, including long-distance freight, shunting, and heavy cargo transportation.


  • Leverage Mergers and Acquisitions: Following the example of TX Logistik’s acquisition of Exploris Deutschland Holding, shippers might consider strategic mergers or partnerships to expand their reach, diversify services, and increase operational capacity.

  • Analyze Traffic Patterns: With only a modest increase in rail freight traffic through the Channel Tunnel, shippers should continue to monitor traffic patterns and adjust their scheduling and routing accordingly to optimize transit times and costs.



Wiima Logistics is a provider of fourth-party logistics (4PL) services. The 4PL service provides the customer with a complete solution for supply chain management, administration and outsourcing.

4PL operations can be described as outsourcing the management and coordination of the entire supply chain – this allows the customer to focus on their core business.

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