Middle East rates ease as air cargo demand climbs 7%

Air cargo rates on Middle East trade routes began easing in June as capacity returned through major Gulf airport hubs, even as exceptional demand for semiconductors and AI-related hardware pushed global air cargo demand up 7 per cent year on year, according to Xeneta. Global capacity increased 3 per cent, while spot rates averaged USD 3.40 per kg, up 38 per cent from a year earlier.

The return of capacity through the Gulf hubs, along with lower jet fuel prices, has started reducing pressure on freight rates after recent increases. Although spot rates remain elevated, the pace of annual growth slowed from 41 per cent in May to 38 per cent in June, signalling that the market is beginning to stabilise.

The easing trend is also visible on Middle East corridors. Rates from South Asia to the Middle East remain 88 per cent above earlier levels, while rates from Southeast Asia and Europe are still up 46 per cent and 79 per cent, respectively. However, Xeneta said rates are moving down month on month as more capacity returns.

"The air freight market has kept on moving and showing its ability to navigate uncertainty," said Niall van de Wouw, Chief Airfreight Officer at Xeneta. "Air freight is not in control of its own destiny, but no one can deny its ability to respond and pivot when challenges come along."