Air freight rates were sharply higher in October than a year earlier, but the increase is not spread evenly across lanes. The Baltic Air Freight Index averaged 2,651.25 in October, up 8.2% from September and 25.9% from a year earlier, according to Cargo Facts Consulting commentary on the index1.
Xeneta's separate dataset put the global average spot rate at $3.11 per kg, up 4% month on month and 29% year on year1. Demand rose about 6% while capacity stayed flat, and the dynamic load factor, which combines weight and volume, rose two percentage points to 63%1, 2. These are spot rates, not the contract prices many buyers negotiate1, 2.
The rise is concentrated on Asia-origin and transatlantic lanes
October's average Hong Kong-Europe rate rose 11.1% from September, and Shanghai-North America's BAI82 rose 7.1%1. TAC spot data show Hong Kong to the US east coast at HK$63.02 per kg on 30 October against HK$51.84 on 30 September. Hong Kong to Europe went from HK$35.42 to HK$40.84 per kg over the same period1.
Xeneta's corridors show the same picture with different slopes. Europe to North America had the largest monthly increase, up 10% to $2.31 per kg, as airlines moved to winter schedules1, 2. Northeast Asia to North America rose 4% to $6.21 per kg and Southeast Asia to North America 3% to $6.34 per kg2. Northeast Asia to Europe rose 4% to $4.97 per kg, and Southeast Asia to Europe rose 3% to $4.35 per kg2.
Capacity is doing more of the work than demand
Xeneta's read is steady growth, not a late peak. "It's strong, but it's not a 'peak' season, and time is quickly running out for volumes to shift higher," chief airfreight officer Niall van de Wouw said1.
Capacity explains more of the price action than demand. Cargo Facts Consulting reported that Asia-Europe freighter capacity recovered 5.2% month on month in September after three months of decline, while Asia-North America capacity rose 2.3%, its third consecutive monthly gain1. In October, Xeneta reported a further fall in direct Asia-Europe freighter capacity, on top of capacity lost on routings through the Middle East. The reports did not give a percentage for October1, 2.
The transpacific went the other way. Asia Pacific to North America chargeable weight ran about 15% higher year on year in October, with freighter capacity growing at a similar pace1. CH Robinson said in its November market update that technology shipments were tightening selected Asia-origin services, and that oversized and heavy shipments depend on freighters. It warned that airlines could redirect freighters towards stronger transpacific demand, reducing options elsewhere, while capacity remained available on most major Asia-Europe services, where the peak had developed more slowly than expected1.
Some of the space on Asia-Europe reflects weaker demand. Xeneta reported that air e-commerce volumes from Asia to Europe were 61% lower year on year in the third quarter, after the European Union added a 3 euro charge on packages from 1 July2.
The four carriers are exploring network cooperation rather than announcing new capacity. Lufthansa Cargo, SWISS WorldCargo, ANA and Nippon Cargo Airlines signed a memorandum of understanding this week to explore Japan-Europe cooperation, including NCA's freighter operation. No launch date or capacity commitment was announced1, 3.
The results show what access to lift is worth. IAG Cargo, which gave up its own freighter operations more than a decade ago, raised third-quarter cargo revenue 3.9% to 294 million euros ($328m) even as traffic fell 13.9%. Cargo tonne km (CTK), a measure of freight carried over distance, fell to 1,101m, while revenue per CTK rose 20.7%1. IAG said capacity was hit by Middle East disruption and the cancellation of third-party long-haul freighter capacity, which cut volumes particularly from Asia Pacific1. DHL Global Forwarding moved 497,000 tonnes of air freight in the quarter, up 12%, and DHL said constraints in the market generated demand it served through its own network1.
Fuel is doing part of the work
TAC cited IATA data showing jet fuel prices 112.8% higher year on year on 30 October1. IATA's own monitor put the global average jet fuel price at $191.54 a barrel last week, down 2.6% from the week before4.
Rotate compared fuel with yields and found a gap. Fuel was up 111% year on year in the final week of September, against a 26% rise in global air cargo yields5. Its modelled Boeing 777 freighter economics showed Asia-North America flights contributing $2.55 per kg, against a negative $2.12 per kg on the return leg5.
Carriers have passed some of that through in price. Lufthansa Cargo lifted base yields 14% and overall yields 22% in the third quarter, and said it passed on higher fuel costs. Adjusted EBIT more than tripled to 162 million euros ($182m), with a margin of 15.6% against 6% a year earlier6. Where capacity is scarce, carriers are earning more per kilo while carrying less, or charging more for the same volume1, 6.
What a Q1 2027 buyer should expect
Xeneta expects air freight rates to fall overall in 2027, and some Asia-Europe cargo to return to ocean once schedule reliability recovers, most likely from the second quarter1, 2. The forecast rests on the Middle East: van de Wouw said a recovery there would rebalance supply and demand and push rates lower1.
Long contracts are hard to price in the meantime. Forwarders can offer 12-month deals, van de Wouw said, but would have to bake in so much uncertainty that the price becomes uncompetitive1. Xeneta reported in October that shippers were seeking "floating mechanisms" in airfreight rates before committing to long-term capacity7.
Booking windows are short. Lufthansa Group's finance chief said visibility in air freight is usually limited to about two weeks' booking in advance6. CH Robinson said capacity remained available on most major Asia-Europe services, while a forwarder told The Loadstar that capacity was "extremely tight" on the Far East to North America lane1, 6.
An early Lunar New Year adds a deadline. The holiday starts on 6 February 2027, 11 days earlier than in 2026. Seko Logistics is advising shippers to place bookings at least four weeks ahead, and warns that air freight and sea-air are the costly fallback when ocean space runs short8.