Expect Continued Increases to Air Freight Rates

Upheavals in supply and demand are forcing airlines to increase rates for cargo while COVID-19 continues to disrupt and complicate supply chains around the globe.

Airlines are having to increase rates to make up for reduced capacity and an ever-increasing demand to transport freight during the ongoing pandemic. The increase in demand is due to multiple factors, from the continued disruption to sea-freight operations to an e-commerce boom as well as the busy upcoming retail season. [1]

In addition to these complications, the coming COVID-19 vaccines are being touted as the “largest product launch in history.” While pharma companies around the world race to produce vaccines, some supply chain players are positioning themselves to take advantage of the need for sudden and swift global disbursement. Transporting the vaccine will take precedence over commercial demand, further reducing capacity as the busiest commercial season approaches. [2]

Be sure to account for rising costs and greater lead times while planning to move freight by air in Q4 2020 and Q1 2021. 

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Sources:
[1] Air freight rates on the up again, driven by more demand for less capacity, The Load Star
[2] Vaccine charter flights: carriers get set to chase a slice of the Covid cake, The Load Star