Air Freight Rates Plummet: Peak Season 'Underwhelms'

An analysis of the global air freight market in October 2025 reveals that spot rates continued their decline for the sixth consecutive month due to overcapacity, signaling weakening demand in the coming months, despite a slight increase in volumes.

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Rates Plunge as Market Shifts to Favor Shippers

The air cargo market is shifting even more decisively in favor of shippers, while carriers prepare to grapple with softening demand. This is the key takeaway from a November 6 report released by Xeneta, an ocean and air freight market data analytics firm.

In October, the global air freight spot rate fell for the sixth straight month, recording a 3% year-on-year (YoY) decrease to an average of $2.58 per kg (according to Xeneta data). Notably, seasonal contract rates declined even faster, hitting $2.31 per kg, an 8% drop compared to the same period last year.

Despite the rate decline, global air cargo volumes in October increased by 4% YoY compared to 2024. However, this growth was insufficient to outpace the 5% increase in capacity. The report also highlights that peak season momentum continues to be "underwhelming" across the three top global trade lanes.

October by the Numbers

• 4% Increase in global air cargo volumes YoY

• $2.58/kg: Average spot rate, down 3% YoY

• $4.84/kg: Spot rate from Southeast Asia to North America, down 21% YoY

• $4.37/kg: Spot rate from Northeast Asia to North America, down 10% YoY

Challenges Ahead for Airlines and Forwarders

Air freight demand in October was slightly stronger than expected, especially considering the expiration of the U.S. de minimis duty exemption on August 29 and the abatement of "frontloading" activities by shippers following a surge ahead of new tariffs, according to Xeneta.

However, current trends suggest significant challenges for airlines and freight forwarders in the months ahead.

Mr. Niall van de Wouw, Xeneta’s Chief Airfreight Officer, commented in the report: “The announcements by companies about reductions in cost are increasing left and right - and will continue - and we would not be seeing that if the market outlook was more positive.”

Mr. Van de Wouw also pointed to a 6% YoY drop in demand on the Europe–North America lane in October - a route heavily focused on general air cargo - as a “bellwether for the rest of global trade,” underscoring that the market is cooling. Despite this, the spot rate on this lane saw a 4% increase YoY, which is a significant slowdown from the 23% growth recorded earlier in the year.

Meanwhile, e-commerce shipments from China to the U.S. fell for the fifth consecutive month in September, with volumes down 34% YoY (per Xeneta). The previous de minimis exemption was a crucial driver for traffic on this lane.

Amid weakening demand, Mr. Van de Wouw predicts air freight rates will remain under downward pressure as forwarders compete aggressively for volumes. While shippers may benefit from lower rates, they are likely more concerned with bigger issues.

Mr. Van de Wouw concluded: “I think most shippers would rather accept a 10% higher shipping cost and 10% higher sales than a 10% lower shipping cost and 10% lower sales.”

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