If you've been watching air cargo markets this month, you might have found yourself scratching your head.
Global tonnage fell 4% week on week in the first full week of August, with declines from every single origin region. Volumes out of the Middle East and South Asia dropped 6%. Europe and North America both slipped 4%. Asia Pacific was down 3%. Even capacity edged lower, shrinking 1% globally.
So naturally, rates should be tumbling too, right?
Not quite.
The numbers tell a different story
The global average airfreight rate barely budged – slipping from $2.96 per kg in week 31 to $2.95 in week 32. That's a rounding error. And here's the kicker: rates still sat a whopping 22% above where they were this time last year.
The Baltic Air Freight Index (BAI00) declined just 0.2% in the week to August 10, but remained 16.9% higher year-on-year. A week later, it actually edged up 0.2%.
So what's going on? Demand is softening, but rates are holding the line. That's not supposed to happen.
The forces keeping rates aloft
First, let's talk about what's not driving this resilience. It's not fuel. Jet fuel prices actually eased slightly in early August as expectations of a potential US-Iran deal took some pressure off crude markets. WorldACD explicitly said the rate slip was "driven largely by lower fuel costs".
No, the real story is structural.
AI cargo is propping up the market
While consumer-driven ecommerce volumes are falling – especially on China-Europe lanes after the EU scrapped its €150 duty-free threshold on 1 July – high-value tech cargo is quietly keeping the market afloat. Semiconductor and AI server shipments from Taiwan, Korea and Vietnam to North America continue to grow at double-digit rates.
Xeneta's Chief Airfreight Officer Niall van de Wouw put it this way: "Very few people are talking about peak season". But the peak that is happening isn't your father's peak season – it's a tech-driven one, and it's keeping rates from collapsing on key transpacific lanes.
Capacity is shrinking, not growing
Here's another twist: global capacity actually fell 1% week on week in early August. Asia Pacific capacity dropped 2%. That's partly due to Typhoon Dolphin, which caused over 1,000 flight cancellations in Shanghai alone. But it's also a sign that airlines are pulling back freighter capacity on weaker lanes – particularly China-Europe e-commerce routes – and redeploying it toward higher-yield transpacific trades.
Less capacity means less downward pressure on rates, even when demand softens.
The Middle East premium is fading – but not fast
Spot rates from Northeast Asia to Europe fell 13% month-on-month in July, with China to Western Europe down a staggering 22%. That's the EU de minimis effect in action. But Middle East-related premiums are unwinding slowly. Spot rates into the Middle East from South Asia were still 84% above pre-conflict levels in late July. And rates from Northeast Asia to North America remained 33% above late-February levels.
As van de Wouw noted, airlines will be "fighting tooth and nail to avoid reducing rates as quickly as they went up". The downward trajectory is real, but it's happening in small steps, not big jumps.
What this means for shippers
For cargo owners, this is a market of extremes. If you're shipping high-value tech to North America, you're still facing tight capacity and elevated rates. If you're shipping low-value ecommerce to Europe, you're seeing more breathing room – but also dealing with a fundamentally changed regulatory landscape.
The key takeaway? Market averages tell you almost nothing anymore. Lane-level dynamics, cargo mix, and timing matter more than ever.
This is where experience pays off
Navigating a market this fragmented requires more than a booking portal and a prayer. It requires real-time intelligence, strong carrier relationships, and a partner who understands that what's happening on the transpacific doesn't always reflect what's happening on the transatlantic.
At Xiamen AE Global, we've been moving air freight through exactly this kind of complexity since 2018. We're a government-licensed company with IATA, FIATA, FMC, and NVOCC credentials – which means when the market fragments, we have the global network and the carrier relationships to secure space for our clients, even on the tightest lanes.
Real relationships, real options
With over 100 overseas agents worldwide, we don't just watch the rate indices from a distance. We work directly with our partners on the ground to understand what's really happening on each trade lane. When AI cargo is tightening capacity out of Taiwan or Korea, we know about it – and we adjust our clients' strategies accordingly.
Technology that cuts through the noise
We've invested heavily in technology that gives our clients real visibility – not just a tracking number, but actual insight into what's happening with capacity, schedules, and alternatives. When a lane softens or a surcharge hits, we don't wait for you to find out the hard way. We alert you immediately and present options.
Local knowledge, global reach
Based in Xiamen – one of Asia's busiest air cargo hubs – we combine the global reach of an IATA and FIATA-approved forwarder with the local knowledge of a partner who's been shipping all kinds of goods for over a decade. We've moved over 12,000 TEUs in a single year with a 98.6% on-time delivery rate for our SME clients. That's not luck – it's relentless execution and a network that doesn't fall apart when the market gets complicated.
The bottom line
Air cargo demand is softening, but rates are showing surprising resilience. That's not a contradiction – it's a reflection of a market that's being pulled in different directions by AI-driven tech demand, collapsing ecommerce volumes, shrinking capacity, and slowly unwinding geopolitical premiums.
For shippers, that means one thing: you need a logistics partner who understands the nuances, not just the headlines.
At Xiamen AE Global, we don't just move boxes. We help our clients navigate complexity – whether that's securing space on a tight tech lane, finding alternatives when ecommerce volumes dry up, or simply making sure your cargo gets where it needs to go, on time and on budget.
Because when the market doesn't move in straight lines, you don't need a spectator. You need a partner who knows which way the wind is actually blowing.
Ready to work with a logistics partner who actually understands the market? Contact Xiamen AE Global today – and let's keep your supply chain moving, no matter what comes next.
