Holidays Slow Traffic but Not Pricing

Why It Matters

The divergence between falling traffic and rising rates signals a tightening market, boosting carrier revenues but pressuring shippers’ cost structures across key trade lanes.

Key Takeaways

• Week 22 cargo volumes dropped 9% WoW, driven by holidays
• Global capacity slipped 1% WoW, with MESA down 6%
• Average airfreight rate rose 2% WoW to $3.29 per kg
• YoY rates up 35% while volumes fell 3% overall
• MESA led price gains, up 58% YoY to Europe and US

Pulse Analysis

Holiday calendars in late May created a noticeable dip in air cargo demand, especially in regions where multi‑day celebrations such as Eid al‑Adha and Pentecost curtailed shipments. The Middle East & South Asia (MESA) and Africa experienced the sharpest volume contractions, reflecting both outbound and inbound traffic reductions. Meanwhile, Asia Pacific, Central and South America and other markets showed only modest declines, underscoring the uneven geographic impact of cultural observances on global freight flows.

Despite the demand shock, pricing resilience persisted. The average global airfreight rate climbed to $3.29 per kilogram, a 2% week‑on‑week increase, and year‑on‑year rates are up 35%. This upward pressure stems from limited capacity, particularly the 6% week‑on‑week drop in MESA, which has become the primary driver of price growth. Carriers are leveraging tighter supply to secure higher yields, while shippers face escalating costs even as shipment volumes recede.

Looking ahead, the market’s tightness appears likely to continue. Year‑to‑date freight rates are up 17% in MESA and over 30% in Africa, outpacing volume growth in most regions. The modest 4% YTD increase in total tonnage suggests that capacity constraints, rather than demand, will dominate pricing dynamics. Stakeholders should monitor holiday calendars and geopolitical factors that could further compress capacity, as they will shape revenue opportunities for airlines and cost pressures for logistics providers in the coming quarters.