More signs of improvement in air freight

The information in the first 10 days of March 2023 shows that the slight improvement in the air transport market as production in China has increased again, but demand in ASEAN and neighboring markets remained weak as most industries saw a sharp drop in export orders from the EU-US market bloc. Along with China's efforts to restore production, e-commerce and a more vibrant global travel season from the second quarter are expected to reinforce the optimistic signals for the global aviation market

Earlier, in its latest weekly market report, data provider TAC Index indicated that the overall Baltic Air Transport Index including freight rates offered by forwarders increased by 3 .5% for the week to March 6, 2023.

“After a long period of falling spot rates and contracts being renegotiated at lower levels, the market may finally bottom out and gradually rise again, as China opens its market up,” TAC said. Schools and shipping are busy in the second quarter.”

In fact, spot rates and shipping volumes increase as production in China gradually recovers.

Elsewhere, freight forwarding company Flexport also recorded an improvement in demand. Accordingly, the demand for transpacific eastbound air transportation from northern China is continuing to increase leading to limited capacity.

“The main contributing factor is the increase in demand in e-commerce freight. As a result, freight rates have increased in the first week of March 2023,"-Flexport said.

The company said supply from southern China is scarce while demand is growing in the market, leading to higher freight rates from last week.

On the other hand, demand from Taiwan, Korea and Southeast Asia is still weak and needs more time to catch up.

Many ASEAN member economies are export-oriented and highly influenced by external factors. Weak demand led to a decrease in orders from large and traditional markets in Europe and America, which directly impacted the air transport market connecting to ASEAN. However, some optimistic signals from the Chinese market - the largest and nearest partner of ASEAN countries, plus a "new wind" from Oceania markets are expected to help the market prosper. next month.

From the Americas, demand has remained stable while demand from Europe has increased along with fluctuations in freight rates.