Air, Freight News

Airfreight prices on the way down, but don’t hold your breath

[ January 24, 2023   //   ]

ParcelHero predicts that airfreight rates will continue to fall for the first half of 2023, while ocean transport rates will also continue to sink.

Head of consumer research for the parcel broker, David Jinks said: ‘International airfreight rates are, to be blunt, all over the place. Rates between East Asia and Europe have fallen by 30-40% compared to this time last year. UK shoppers buying goods manufactured in China may ultimately profit from this as import costs fall. However, the freight analytics platform Xeneta says China-Europe airfreight rates are still up 62% on pre-pandemic levels, despite the current drop. That means, in our view, it’s too soon to expect a dramatic fall in UK store prices.”

“A lot of the turbulence hitting airfreight is based around changing conditions in China. Chinese New Year factory shutdowns always flatten demand for air cargo space in the first months of the year. In addition, China’s wholesale lifting of Covid restrictions has increased international travel, thereby increasing spare belly capacity.”

“As far as UK exporters are concerned, in terms of Europe to the US, airfreight rates are down around 14% on January 2022, which is good news. However, these rates are still up an eye-popping 70% compared to pre-pandemic 2019. Clearly, there is room for movement here as well.”