Reliable Forwarding

April 07-11 2025 Edition

Air Cargo Key Trends, Q1 2025

• Air Cargo Tonnages (Global): +3% Year-on-Year (YoY)
• Average Global Rates: +4% Year-on-Year (YoY)

Comparison to Previous Period (2024):

• 2024 Average Tonnage Growth (YoY): +11%
• Q4 2024 Tonnage Growth (YoY): +8%

Factors Influencing Current Market:

• Uncertain market conditions
• Anticipated disruptive new wave of U.S. tariffs especially with China (125%)
• Removal of U.S. de minimis exemptions for shipments from China and Hong Kong
• Challenges to some long-standing supply chain models

March 2025 Performance (Month-on-Month – MoM):

• Worldwide Tonnages (MoM): +19% (March vs. February)
  • Note: February figures were lower due to seasonal factory closures after Lunar New Year.

March 2025 Performance (Year-on-Year – YoY):

• Worldwide Tonnages (YoY): +5%
• Tonnage Growth by Region (YoY):
  • Asia Pacific: +9%
  • North America: +6%
  • Middle East & South Asia (MESA): -6%
• Average Worldwide Rates (March): $2.38 per kilo
  • Rate Change (MoM): +4%
  • Rate Change (YoY): +2%

Week 13 2025 (March 24-30) – Spot Prices (Asia Pacific Origins):

• Spot Price: $3.80 per kilo
• Spot Price Change (Week-on-Week – WoW): +3%
• Tonnage Change (WoW): -3%

Shifting Trends in Global Shipping Rates

China-NA Rates Up (HKG +2.9% WoW, +3.6% YoY; SHG +2.5% WoW, +5.4% YoY): Despite some BSA cancellations, rates on busiest China-US lanes are rising. Reason: Potential volcanic disruption in Anchorage & sustained demand.

Intra-Asia (ex-China) Rates Softer: Vietnam & India routes saw slight decreases. Reason: Possible demand shift towards primary China lanes or regional economic variations.

Europe Outbound Rates Falling (FRA -14.1% WoW, still +7.3% YoY; LON -12.2% WoW, -11.2% YoY): Rates down to China, Japan, & US. Reason: Easing demand for European exports & potential market correction after prior gains.

Americas Outbound Rates Rebounding (CHI +11.1% WoW, +12.4% YoY): Rates rising again to China, Europe, & South America after recent drops. Reason: Potential strengthening demand for American exports.

Key Trend: Divergent rate movements across trade lanes. China-NA strong, Europe weakening, Americas recovering, other Asia softer. Driving Factors: Demand shifts, potential short-term disruptions (Alaska volcano), and market corrections are influencing these changes.

Viet Nam / USA Trade: Signs of Goodwill

Key Context:

• U.S. initiated 90-day “tariff pause,” impacting Vietnam.
• This pause gives Vietnam time to adjust to trade shifts.

Vietnam’s Response:

• Increased U.S. Imports:
  • Buying Boeing aircraft.
  • Boosting agricultural imports (soybeans, corn, pork, wheat).
  • Expanding LNG imports.
• Considering Tariff Cuts:
  • For U.S. energy, tech, medical, and pharma goods.
• Stronger Origin Control:
  • Tighter rules to prevent trade fraud.
  • Focus on key exports: wood, seafood, textiles, electronics.
• Developing Industries:
  • Attracting investment to reduce import reliance.
  • Priority sectors: yarn/fabric, microchips.

Trends & Implications:

• Trade Volatility: Tariffs create uncertainty, requiring agile responses.
• Vietnam’s Strategy:
  • Balancing U.S. relations.
  • Diversifying its economy.
  • Enhancing production.
• Supply Chain Changes: Vietnam aims to be less reliant on imported materials.
• U.S. Importance: U.S. is a major market for Vietnam (e.g., textiles, wood).
• 2024 Trade Data (USTR):
  • Total U.S.-Vietnam goods trade: $149.6 billion.
  • U.S. exports to Vietnam: $13.1 billion (up 32.9% from 2023).
  • U.S. imports from Vietnam: $136.6 billion (up 19.3% from 2023).
  • U.S. goods trade deficit with Vietnam: $123.5 billion.
• Key Vietnam Exports to U.S.:
  • Computers and electronics
  • Textiles and apparel
  • Footwear
• Key U.S. Exports to Vietnam:
  • Machinery
  • Agricultural products
  • Aircraft

Retail Optimism vs. Tariff Realities & Shipping Disruptions

Retail Outlook 2025 (NRF):

• Sales Growth: +2.7% to 3.7% YoY (Total: $5.42T–$5.48T).
• Online Sales: +7%–9% YoY ($1.57T–$1.6T).
• Key Factors: Low unemployment, wage gains, solid finances.
• Tariff Impact: Retailers don’t expect tariffs to significantly hurt spending or cause recession.
• GDP Growth: Expected to slow to under 2%.
• Inflation: Tariff-related inflation may keep PCE around 2.5%.
• Risks: Policy uncertainty, lower consumer confidence, tariff anxiety.
• Credit: Delinquencies slightly up but normal if jobs stay strong.

USA/India Tariffs:

• India Export Surge: Bookings to US East Coast (USEC) up due to new 26% US tariff (effective April 9 – NOW PAUSED)
• Rate Hikes: Carriers pushing through April increases. More hikes planned for May (CMA CGM +$1000/container, Hapag-Lloyd +$500/box).
• Logistics: Indian ports working overtime; West India sailings fully booked; logistics delays due to capacity.
• US Importers: Rushing shipments to beat tariff deadline (NOW PAUSED)
• Spot Rates: Rose to $2150/FEU (up 13% on April 7).

Transpacific Shipping:

• Rates Down: Spot rates fallen for 9 straight weeks.
• Capacity Reduction: Carriers like MSC canceling sailings (at least 6 in April). Others expected to follow.
• Disruptions: Vessel changes and delays ongoing, expected through April.

Asia/EU Shipping:

• Ocean Alliance: Resumed AET service (Shanghai to Europe).
• Red Sea Risks: Renewed US airstrikes increase Houthi attack threat on ships, destabilizing region. Many targeted ships have no clear US/UK/Israel ties.