The restarting of production in Chinese manufacturers may signal the beginning of a potential comeback in the air cargo sector. Data source TAC Index reported that although air freight prices continued to move marginally down last week, there were indications of a recovery for the first time in a while following previous sharp pricing declines.

They reported that while the overall Baltic Air Freight Index decreased 0.9% from the previous week, rates out of Hong Kong rose 2.6%. Following recent declines in the bottom quintiles of paid prices, both spot rates and volumes appear to grow as Chinese production gradually increases.

Market demand from North China is low, although there was an upward trend leading up to the weekend, and rates have climbed compared to the previous week. Yet, overall, the demand from most other Asian countries was weak.

Over February, rates on critical trade lanes continued to drop while they remained above pre-Covid levels.

According to the Baltic Exchange Airfreight Index (BAI), the average contract and spot prices paid by forwarders for Hong Kong-to-North America services in February decreased to $4.93 per kilogram from $6.14 per kilogram one month earlier and $9.50 per kilogram one year earlier. Yet, they remain higher than the $3.54 per kilogram paid in February 2019.

The average price paid by forwarders on flights from Hong Kong to Europe decreased to $4.40 per kilogram from $4.96 per kilogram in January and $5.80 per kilogram a year earlier. In February 2019, the average price paid per kilogram on the market was $2.52.


The Asia-U.S. container spot pricing decline is easing as the transpacific yearly contract negotiation season approaches. The inability of ocean carriers to arrest the drop-through capacity management, blank sailing plans, and steeply discounted short-term fares has exposed transpacific lines to substantial concessions in bidding for new contracts beginning in May.

This week, Asia to U.S. west coast component dropped further 4.6% to $1,182 for 40ft, compared to the average for the same week last year of $15,897. This demonstrates how drastically and rapidly the U.S. market has plummeted.

This week, U.S. east coast reading fell 4% to $2,881 per 40-foot container. Asia-to-US east coast trade lanes, once more robust, are also losing premium spread advantages.

In addition, the breakeven point for Asia USEC airlines will be considerably higher than for their west coast services because the longer transit periods require significantly more fuel and the high cost of Suez Canal’s and Panama’s fees, which must be accounted for in voyage calculations.

Similarly, carriers on the Asia-Europe trade route are facing a decline in once-healthy margins on each round-trip journey. On Xeneta’s XSI, the lowest Asia-North Europe spot pricing was reported at $1,548 per 40 feet, down 5% from the previous week, 13% from the last month, and compared to approximately $14,500 twelve months ago. But, the market is saturated with offers from China-based forwarding agents providing significantly lower FAK prices with shipment validity through the end of March, using all the major carriers.

Despite more robust market fundamentals, spot prices are sliding from Asia to the Mediterranean, falling another 2% to $2,540 per 40ft this week.

The transatlantic trade lane continues to be the outlier in the spot market, with indices demonstrating extraordinary resilience in the face of a massive influx of capacity and significantly lower load factors on the head haul North Europe to U.S. east coast route. This week, the indices from North Europe to the East Coast of the United States were almost unchanged, between $4,992 to $5,641 per 40 feet, respectively.


The European Commission has proposed revisions to the E.U. Driving Licence Directive to address the shortage of drivers in the goods transport sector. However, it fails to address the problem of driver shortages in passenger mobility. The IRU’s 2022 driver shortage report shows that Europe needs more than 600,000 drivers, which could reach almost 2 million by 2026. The shortage is because of higher aging drivers and a low share of young drivers, with only 6.2% of professional drivers under 25 years old in the E.U. The revision of the E.U. driving license directive provides the possibility of removing one of the significant barriers to young people joining the profession.

The minimum driving age for truck drivers is 18, and the Commission recommended allowing 17-year-olds to start training. However, these changes are not included in the passenger sector. The proposal has also taken steps to facilitate third-country drivers’ access to the profession in the E.U. It represents a positive step towards addressing the driver shortage, despite determining the list of countries and concrete conditions based on solid safety criteria.



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