WorldACD: Air Cargo Demand from Southeast Asia to the US Explodes

Week 46 data from WorldACD shows Asian air freight rates continuing to climb ahead of Black Friday. Notably, volumes from Vietnam, Malaysia, and Taiwan to the US recorded "skyrocketing" growth of 40-60% year-on-year, offsetting declines from China.

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Air freight rates continued their upward momentum during the final run-up to Black Friday and Thanksgiving later this month. According to the latest figures from WorldACD Market Data, the primary driver was the rise in spot prices on routes from Asia-Pacific to the US and Europe, alongside a pickup in the intra-Asia market.

In the second full week of November (Week 46: Nov 10-16), average spot rates from Asia-Pacific origins increased by +4% week-on-week (WoW), reaching $4.11/kg. Tonnages from the "world's factory" region also continued to edge up by +1% (WoW) during this pivotal retail period.

The Transpacific: Rates Rise, But Remain Below 2024 Peaks

Spot rates from Asia-Pacific to the US climbed another +4% (WoW) to $5.51/kg. This increase was driven by a strong rebound from the Japanese market following a national holiday (volumes up 16%, rates up 10%), along with rate increases from South Korea (+13%) and Vietnam (+8%).

However, when compared year-on-year (YoY), average spot rates on this lane have been declining since late April and are currently down -11% in week 46. The steepest declines were recorded from Japan (-31%), Singapore (-19%), Indonesia (-19%), Vietnam (-17%), South Korea (-10%), and Hong Kong (-8%).

It is important to note that the market in late 2024 experienced unusually strong demand and severe capacity tightness, particularly from China due to the e-commerce boom. Therefore, this year's rates face a very high comparative "baseline" from last year, even though they remain elevated by historical standards.

Trade Flow Shifts: Southeast Asia Takes the Spotlight

Despite the US imposition of higher tariffs and restrictions on de minimis exemptions for imports from China starting in April, total air cargo volumes from Asia-Pacific to the US remain significantly higher than last year.

Although tonnages from China (-2% YoY), Hong Kong (-16% YoY), and South Korea (-10% YoY) were all lower than last year's levels in week 46, the region as a whole still grew by +6% (YoY).

The main driver for this growth came from Taiwan and Southeast Asian nations. According to a new analysis by WorldACD, demand from Southeast Asia to the US surged +40% (YoY) in October – the highest monthly growth rate this year. For the first 10 months of the year, volumes from Southeast Asia to the US have increased by an average of nearly +26% year-on-year.

"China + 1" Trend and the Semiconductor Fever

The divergence in trends is stark:

• China & Hong Kong to the US: Year-to-date (YtD) volumes fell nearly -6%.

• China & Hong Kong to Europe: YtD volumes rose about +8% (reflecting a diversion of exports to Europe).

• Southeast Asia to Europe: YtD volumes fell nearly -6%.

These figures reflect the trend of US importers seeking alternatives to Chinese supply. For markets like Taiwan, growth is further fueled by massive demand for high-performance semiconductors used in AI.

Air import volumes from Taiwan to the US have consistently grown by around 30-50% this year. Similar trends are seen in Vietnam, Thailand, and Malaysia – where semiconductors and electronic components make up a large proportion of air exports.

Specifically, in week 46, air cargo volumes to the US recorded impressive year-on-year growth figures:

• Malaysia: +62%

• Vietnam: +60%

• Taiwan: +41%

• Thailand: +37%

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