Source: Supply Chain Dive
Date: 20th June 2025

Weakened Consumer Confidence and Policy Shifts Pressure Air Cargo Market

Global air cargo spot rates declined for the first time in over a year, with rates falling 4% year-over-year in April to $2.44 per kilogram, according to a recent industry report.

This decline reflects growing uncertainty in international trade and waning consumer sentiment. While some routes, like China to the U.S., experienced short-term rebounds by early June, broader market conditions remain soft. These developments follow a 90-day tariff reprieve announced in May, which came too late to prevent the downward momentum.

Industry analysts suggest that the drop in rates highlights airlines’ concerns over future stability in trade relations. The shift from air to ocean freight, driven by cost and changing regulations, has reduced demand for premium air services.

The removal of the de minimis exemption and adjustments to tariffs on low-value shipments have further disrupted air freight capacity and routing. As production moves out of China toward lower-tariff countries, carriers are adjusting operations accordingly.

Looking ahead, the expiration of the temporary tariff truce in July and August may trigger a brief cargo surge as shippers frontload goods.

However, long-term expectations remain cautious, with some industry observers predicting more aggressive rate negotiations and ongoing instability.

The air freight market is increasingly influenced by developments in ocean shipping, and any future tariff agreements may ultimately dampen trade activity, further suppressing air cargo demand in the months ahead.