Airfreight rates edged lower last week as China's Golden Week holiday slowed factory output, but the market remains firm heading into the traditional peak season, according to industry reports. The Baltic Air Freight Index showed a 2.1% week-on-week decline.
What Happened
Data provider TAC Index noted that the drop was not unusual for the Golden Week period, when Chinese factories often shut down and volumes decrease. However, TAC also highlighted that the market remained firm as it enters peak season, with potential for rates to rise further.
E-commerce players and other large shippers with product launches have already locked in capacity for the peak season, while some others, including AI hyperscalers, have yet to secure space and could push rates sharply higher. Rising jet fuel prices are also adding upward pressure. IATA's Jet Fuel Price Monitor showed a 3.1% increase in the week to 9 October, with prices up 112% year on year.
By origin, the index for outbound Shanghai slipped 2.1% week on week due to the holiday. However, rates elsewhere in Asia were mostly rising, including on lanes from Taiwan as well as from Japan to Europe and from Seoul to the US. In Southeast Asia, rates from Bangkok were higher week on week, though lower from Vietnam to Europe. Overall rates out of India were slightly lower week on week but still much higher year on year.
Background
Despite the slight decline last week, pricing remains far above last year's levels. The overall Baltic Air Freight Index is up 24.3% year on year, driven by higher jet fuel prices, the conflict in the Middle East and solid demand on the transpacific led by data centre and semiconductor demand.
Impact on Shippers
For Chinese exporters shipping to the US, the post-Golden Week rate dip may be short-lived. As peak season approaches, major e-commerce shippers have already secured capacity, intensifying competition for remaining space and raising the risk of further rate increases. In terms of transit times, tight peak-season capacity could lengthen booking cycles, potentially pushing some cargo to alternative ocean-based solutions. On cost, rising fuel surcharges continue to pressure airfreight chargeable weight expenses.
No policy changes directly linked to this rate movement have emerged in customs clearance, but peak-season volume concentration could extend clearance and pickup times at US ports, so shippers should allow more buffer in their logistics schedules.
Recommendations
Shippers should plan peak-season shipments in advance based on cargo value and time sensitivity, and confirm space and pricing with logistics providers early. Time-sensitive, high-value cargo should prioritize securing airfreight capacity, while less urgent shipments may consider ocean-based options to control costs. Keep an eye on fuel surcharge adjustments and US customs clearance times, and prepare documentation in advance.