The November result is the highest rates have been in at least a year, and it represents a rise of nearly 20 cents, year over year. In October, Drewry measured the rate at $3.73. At that time, Drewry said the change between September and October was the largest shift it had seen since it instituted its East-West Air Freight Price Index in May 2012.
Sources: Drewry Sea & Air Shipper Insight.
Drewry’s index measures an average of the rates and surcharges paid by forwarders on 21 east-west lanes, and the recent results could be seen as a sign that the air cargo industry is turning around after years of unimpressive growth. The firm said November rates were propped up by strong activity in Asia and Europe, and that pricing elsewhere on the lanes didn’t lose the gains seen in October. Drewry added that it “expects air freight rates to fall through December and into early 2014 as the peak season wanes and the boost of product launches recedes.” For Brandon Fried, executive director of the Airforwarders Association, the challenging environment for air cargo could be coming easing up a bit. It all starts with an improving economy, he said.
“We had a few years of really lackluster performance … and air cargo has been adversely impacted,” Fried said.
Fried notes that while the recovery should continue at a slow rate, he expects consumer confidence to grow as a result of the new budget deal and a rollback of some of the sequestration cuts.
“When consumer confidence increases, everything else seems to fall in line, and air freight increases as a result,” he said. “We’re not out of the woods yet, but I think we see daylight.”
