Air freight rates have started to fall, triggering a debate on how long the ‘new’ capacity might stay in the market.

According to the latest TAC Index data, rates per kg from China to the US are down some 5%, to $5.09 all in, while to Europe they have edged down to $4.06 – despite fuel prices creeping up.
They still, however, remain ‘elevated’, with ‘normal’ February rates traditionally below $4 to the US and $3 to Europe.

As Emirates celebrated one year of flying passenger-freighters, however, market observers wondered at what freight rate the additional, less-economical capacity would need to be grounded.

“If rates go any further into decline, carriers will simply stop flying the passenger-freighters, and pure freighters for that matter, on the routes,” said one forwarder. “So I can’t see them softening that much. China/Hong Kong is still fairly dynamic.”

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