India-linked Asia lanes stay tight as global air freight rates ease

TAC Index reports a small weekly dip in average rates, while strong demand on Asia–US and Asia–Europe lanes keeps markets tight for Indian shippers.

Global air-freight rates dipped slightly last week, though capacity constraints and strong demand continued to support high rates on important trade lanes, according to the weekly update by TAC Index.

The agency’s benchmark, the Baltic Air Freight Index (BAI00), fell 1.5% in the week to 24 November. Despite the drop, the index stayed marginally above its level a year ago, up about 0.3% year on year.

For India and the wider Asia region, rates on several routes remained strong. While the overall index eased, forward-looking spot rates from Hong Kong under the new “BAI Spot” indices moved up through the week. The broader Hong Kong index (BAI30) slipped 1.4% week on week and stayed slightly below the same period last year.

Shanghai (BAI80) saw a small weekly fall of 0.2% but stayed 6.6% higher year on year. Rates from other Asian hubs, including Taiwan, Seoul, Bangkok and India, moved up on lanes to the United States and Europe. This suggests continuing demand on long-haul corridors used heavily by Indian exporters and forwarders.

In Europe, some outbound lanes showed mixed results. Frankfurt (BAI20) fell 3.3% for the week but was only slightly weaker year on year. London Heathrow (BAI40) dipped 1.3% week on week but remained 7.9% above last year.

Outbound rates from the US showed a mixed trend. The index from Chicago (BAI50) dropped 6.1% week on week and stayed 13.8% lower year on year. Some lanes, such as Mexico to Europe, saw gains and remained well above last year’s levels.

TAC Index also added new global routes this week. For India, this includes new Asia-outbound coverage of India to Germany. Other new routes include Bangkok to the US, Taiwan to Europe and the US, Europe to Australia, Brazil, India, Mexico and the UAE, the US to Brazil, Germany, Seoul and the UK, and a Latin America lane from Mexico to Europe.

This small correction in global average rates comes as the first phase of the usual peak-season build-up, ahead of Thanksgiving in the US, begins to slow. Capacity pressures remain in the market after the grounding of the MD-11 fleet following a recent fatal crash in the US. This continues to affect freighter availability and keeps rates firm on major long-haul lanes important to Indian trade.