EXTRANS GLOBAL - Air Freight News - Week 47 2025

Air Cargo General

1) Southeast Asia Logistics Restructured by the 'China plus One' Strategy

Explosive Growth in Southeast Asia Air Cargo Demand and Market Structure Changes

Southeast Asia's air cargo demand has surged exponentially, driving airlines to invest in new aircraft and reshape their hub operations.Rhenus Group announced plans to establish additional air cargo gateways in Singapore, Thailand, and Malaysia, expanding strategic investments across the Asia-Pacific (APAC) region.Asia is projected to account for approximately 60% of global air cargo growth between 2025 and 2026.

Logistics Network Restructuring Amid U.S.-China Tariff Shifts

Cargo flows shifted within weeks of escalating U.S.-China tariff tensions: shipments from China dropped by 30%, while those from Southeast Asia surged by 48%.Manufacturers adopting Southeast Asia as an alternative production base (beyond China) have drastically redirected air cargo routes.Despite declining demand from the U.S., Southeast Asia has emerged as the epicenter of global demand recovery.

Country-Specific Demand Growth Traits: Explosive Expansion in Vietnam, Taiwan, Cambodia, etc.

Vietnam: 84% year-on-year (YoY) growth in Jan-Jul; U.S.-bound air cargo up 19% in Apr-Jul.
Taiwan: Sustained growth driven by its role as a semiconductor hub (producing 60-80% of global semiconductors).
Cambodia: Air cargo market size effectively doubling annually.
Thailand: Rising air cargo volumes fueled by expanded automotive and IT production facilities.

These shifts are accelerating Southeast Asian airlines' transition to hub-based operating models.

Network Transformation of Asian Airlines (Hub Strategy)

Chinese carriers (e.g., China Cargo, China Southern Airlines) are shifting to a "hub model," consolidating cargo in Southeast Asia before connecting to the U.S. and Europe.Moving beyond traditional point-to-point operations, they are adopting multi-tiered hub networks.The decisive driver: a structural shift in cargo volume from China to Southeast Asia.

2) Global Air Freight Rates Surge – MD-11 Grounding Accelerates "Peak Season Rally"

Global air cargo rates have resumed a sharp upward trend as the market enters the peak season climax.According to the latest TAC Index data (as of Nov 17), the global Baltic Air Cargo Index (BAI00) rose 4.6% week-on-week (WoW) and 2.4% YoY.

This surge is attributed to:

Seasonal demand ahead of the U.S. Thanksgiving and European Christmas holidays.
A sudden short-term supply crunch following the global grounding of MD-11F freighters after a Louisville MD-11 crash earlier this month.

Rates from China to Europe and the Americas both posted strong gains. Across North Asia, rates to key destinations such as India, Mexico, and Spain rose simultaneously:

Hong Kong-origin: +3.6% WoW, +0.5% YoY.
Shanghai-origin: +4.2% WoW, +4.5% YoY.

Vietnam-origin rates to the U.S. and Europe also climbed. Bangkok-origin rates rose for U.S.-bound shipments and stabilized for Europe-bound routes. South Korea and Taiwan-origin rates were mixed, with partial route gains but overall volatility. India-origin rate increases remained limited.

Notably, sentiment toward the peak season in South Korea's export air cargo market remains "cautiously optimistic."

3) Weekly Market Update (WORLD ACD)

Asia Pacific → U.S. Volumes Decline

As of Week 45, Asia Pacific-to-U.S. air cargo volumes fell 6% WoW, with declines across most regions except Singapore and Indonesia.
Key declining markets: China (-7%), Hong Kong (-6%), South Korea (-7%).
Holiday effects in Japan and Malaysia partially contributed to the drop; overall volumes still rose 2% YoY (driven by 30-50% surges in Southeast Asia).
Northeast Asia saw broader declines: China (-9%), Hong Kong (-14%), South Korea (-18%).
Spot rates remained stable WoW.
All top 10 Asia Pacific export markets recorded double-digit YoY volume drops, except China-origin rates (-9% YoY) at $5.57/kg.

Asia Pacific → Europe Comparison

Week 45 Asia Pacific-to-Europe volumes fell 2% WoW, partially affected by holidays in Japan and Malaysia.
China and Hong Kong-origin volumes stabilized WoW; overall YoY volumes rose 9%.
Growth slowed from the double-digit WoW increases seen in the previous three weeks.
Spot rates rose 2% WoW to $4.20/kg; China-origin rates to Europe climbed 5% WoW to $4.56/kg (a rare 6% YoY gain).

4) Asia Pacific Air Freight Rates Rise Again in November – Weekly Volumes Edge Down

Spot rates for Asia Pacific-origin air cargo extended gains in the first week of November, while global total volumes edged down WoW.

Rates: Nov 3-9 spot rates from Asia Pacific rose 2% WoW to $3.99/kg; global average spot rates climbed 1% WoW to $2.78/kg.
Volumes: Total chargeable weight fell 3% WoW. Declines were widespread: Asia Pacific (-3%), Middle East/South Asia (MESA) (-2%), Africa (-2%), Europe (-1%).

Market patterns in Weeks 45-46 mirror last year: stable but slightly declining volumes, with rates continuing to rise ahead of peak season events (Black Friday, Thanksgiving, Christmas).

A key note: Last year’s Week 45 saw "abnormally high rates" due to a surge in China-origin e-commerce shipments. This year’s seemingly lower YoY rates are largely a base effect.

Notable regional trends:

Asia Pacific-to-U.S. volumes fell 6% WoW, with China (-7%), Hong Kong (-6%), and South Korea (-7%) all recording declines.
Asia Pacific-to-Europe volumes rose 9% YoY but fell 2% WoW.

5) Airlines Movement

Air Canada (KJ): Signed an MOU with Vienna Airport authorities on Nov 13 to launch 6 weekly scheduled B747 freighter flights on the ICN-VIE route.
Hong Kong Express (UO): Will increase HKG-TAE flights to daily operations starting Dec 20. Currently operates 31 weekly flights on HKG-ICN and 10 weekly on HKG-BUS.
Aero K Airlines (RF): Launched 2 weekly new flights on the Incheon-Taoyuan (Taiwan) route starting Nov 13.

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