The pre-Christmas spike in eCommerce volumes out of China means that demand for air cargo space has been driving rates up from Hong Kong over the past two months, with signs that the rise in volumes may be sustained.
Earlier in the autumn, we were expecting nothing more than a mini peak but demand has increased significantly in the past four to five weeks with eCommerce changing the picture completely, driving up rates and producing a real end-of-year high.
We have seen reports of two to three thousand metric tons of e-commerce goods flying from Hong Kong every day, which has resulted in some urgent consignments transferring to alternative despatch airports for destinations in the US and Europe.
The volumes coming out of South China are very significant, particularly in an air cargo market that has been devoid of a traditional peak season, but the big question is, how long it may last, because the demand is more related to US and European consumers buying more lower-value goods, than vendor generated.
Capacity on the transpacific lane out of China is particularly tight and some consignments are shipping first to Europe, then on to the US and with air freight rates spiking, Sea Air solutions are proving popular.
This summer, rates out of Asia were so low there was no cost advantage using Sea Air via Singapore, Dubai or Seoul, but now Sea Air is an effective alternative to direct air.
Rates from Vietnam are also strong currently, driven by good hi-tech volumes and increased demand for fashion goods, as well as some volumes being pushed from China into the Vietnamese market outbound.
Within the context of global macro-economics, with high interest rates and inflation, consumer purchasing power is down, and with the emphasis on saving money this eCommerce driven peak may last beyond Christmas and into Chinese New Year.
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