LONGER-TERM contracts between shippers and freight forwarders may signal more common ground in a stabilising global air cargo market which saw demand fall at three per cent year on year in March, according Xeneta'a Clive Data Services.
The distribution of shippers' contract duration in the first quarter of 2023 saw the number of six-month agreements rise to 36 per cent versus 23 per cent in Q4 of last year, a shift which Xeneta air freight officer Niall van de Wouw says could indicate a 'hunt for volume' by forwarders which want to lock-in customers for a longer period of time.
This latest data comes at a time when some retailers are starting to voice concerns over the hoped for rise in consumer spending in Q3 this year and a resulting need to restock inventory levels, reported Sydney's Asian Aviation.
As the cost-of-living crisis gather pace in prime consumer markets, and the conflict in Ukraine shows no sign of abating, retailers now fear a slower and subdued market, meaning restocking and the peak season airfreight windfall this usually creates may not materialise.
Said Mr van de Wouw: 'I think we're seeing signs that some forwarders are willing to take a little more risk on what air freight rates might do because they don't expect the market to drop much further.'
The global air freight market continued to normalise in March, he said. The 38 per cent reduction in the general air freight spot rate year on year produced an average rate cost of US$2.62 per kg. This figure represented a four per cent decline over February.
The rate fall is attributed to both shrinking cargo volumes and recovering cargo capacity. Global cargo volumes have been falling for the past 13 consecutive months but showed some sign of relief in March, as volumes registered their smallest drop of three per cent year on year, the lowest monthly decline in 12 months.
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The distribution of shippers' contract duration in the first quarter of 2023 saw the number of six-month agreements rise to 36 per cent versus 23 per cent in Q4 of last year, a shift which Xeneta air freight officer Niall van de Wouw says could indicate a 'hunt for volume' by forwarders which want to lock-in customers for a longer period of time.
This latest data comes at a time when some retailers are starting to voice concerns over the hoped for rise in consumer spending in Q3 this year and a resulting need to restock inventory levels, reported Sydney's Asian Aviation.
As the cost-of-living crisis gather pace in prime consumer markets, and the conflict in Ukraine shows no sign of abating, retailers now fear a slower and subdued market, meaning restocking and the peak season airfreight windfall this usually creates may not materialise.
Said Mr van de Wouw: 'I think we're seeing signs that some forwarders are willing to take a little more risk on what air freight rates might do because they don't expect the market to drop much further.'
The global air freight market continued to normalise in March, he said. The 38 per cent reduction in the general air freight spot rate year on year produced an average rate cost of US$2.62 per kg. This figure represented a four per cent decline over February.
The rate fall is attributed to both shrinking cargo volumes and recovering cargo capacity. Global cargo volumes have been falling for the past 13 consecutive months but showed some sign of relief in March, as volumes registered their smallest drop of three per cent year on year, the lowest monthly decline in 12 months.
SeaNews Turkey
