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Airfreight leads the way for DHL Global Forwarding in Q2
DHL Global Forwarding reported improved revenues in the second quarter of the year as performance was boosted by growth in its airfreight business. The Bonn-headquartered forwarder saw revenues for the second quarter increase by 17.9% year on year to €5.4bn, while earnings before interest and tax (ebit) was up 21.9% to €240m. Revenue improvements in the division were led by airfreight, which was up 30.4% year on year to €1.9bn, while ocean was up by 8% and road 8.5%. The increase in air revenues outstripped a volume increase of 7% on last year to 473,000 tonnes, suggesting that the improvement in takings was driven by higher rates. Indeed, freight rates have been on the up this year as a result of higher fuel prices, the Middle East conflict's impact on bellyhold capacity and a demand surge for AI-related shipments. Airfreight revenues are at their highest level since the fourth quarter of 2022, while airfreight volumes are at their highest level since the second quarter of 2022. Kuehne+Nagel saw its second quarter volumes increase by 2.8%, while DSV was up 10%. The company said that in the first half, overall forwarding revenues had been boosted by volume growth and volatile freight rates. Airfreight volume growth came primarily on trade lanes from Asia and Latin America and was supported by resilient Asia-related trade lanes and hyperscaler demand, the company said. The express division also had a strong second quarter, with revenues increasing by 21.5% year on year to €7.1bn, while international volumes increased 9.4% on last year and domestic was up 5.2%. International express revenues in the quarter improved by 20%, while domestic was up 13.4%. Performance was boosted by constraints in air cargo. "In a persistently volatile market environment, DHL Express benefited from a gradual rise in weight transported throughout the network," the forwarder explained. "Capacity constraints in the air freight market also had a positive effect on earnings of around €150m." DHL Group chief executive Tobias Meyer said: "The strong revenue and earnings performance in the second quarter demonstrates that the consistent execution of our strategic measures is paying off. "Higher productivity and efficiency, combined with the strength of our global network, enable us to capitalise on growth opportunities and translate revenue growth into even stronger earnings growth. "In an environment that continues to be shaped by geopolitical tensions and shifting trade flows, our customers benefit from our global presence, local expertise, and operational flexibility. "This enables us to support them in adapting their supply chains to changing market conditions while ensuring reliable logistics, even in challenging environments."
Source: aircargonews.net
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Europe's inland transport: higher rates, longer journeys, and pressure on raw materials
Forecasts indicate water levels at the Rhine Kaub gauge will remain extremely low, between 21cm and 27cm through 8 August, this when the 'base' level is 40 cm. Adding to the challenges is major renovation work on the rail line between Troisdorf and Wiesbaden in Germany, which is reducing available capacity. The route is a busy freight corridor connecting inland regions with European seaports. Diversions linked to the works have restricted rail transport options. "The overlap of rail works and low water conditions means lost inland shipping capacity cannot be offset quickly through additional rail services," K+N noted. Intermodal operators are navigating the situation with multiple solutions, including operating additional barges, expanding direct trucking solutions, and increasing alternative rail and feeder connections, it explained. "However, alternative transport options remain constrained, especially with the shortage of truck drivers, which is limiting the ability of road transport to compensate for reduced capacity elsewhere, particularly in the south-west of Germany." Navigation difficulties on the Rhine are yet another reminder that supply chain risks have fundamentally increased, according to Rico Luman, senior sector economist for transport and logistics at Dutch bank ING. "The timing is particularly concerning," he said, adding that such shallow water this early in the season was a clear sign of mounting climate-related issues. Barges transporting raw materials and containers upstream into Germany are often restricted to a fraction of their normal loading capacity. In some cases, four barges are needed to transport the volume one would normally carry, explained Mr Luman. "The result is higher freight rates, longer journey times, and pressure on raw material supplies for manufacturing sites. Remarkably, these extreme low-water events have occurred more often in the past decade than in the preceding five decades." He concluded: "Building resilience, including considering higher buffer stocks where appropriate, is no longer a temporary adjustment but a structural necessity. "The lesson is becoming increasingly clear: [supply chain] resilience is no longer a luxury. It is a prerequisite for doing business in today's world."
Source: theloadstar.com
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Xeneta: Little evidence of an air cargo peak season boost
The air cargo market is continuing to cool and there is little evidence that airlines will this year gain a peak season boost, according to data provider Xeneta. The data provider today released its market update for July, showing a demand increase of 4% year on year, while capacity was up 1% and the cargo load factor reached 61%. However, average airfreight spot rates fell to $3.12 per kg from $3.40 per kg in July - although they remain up 28% year on year as a result of higher fuel surcharges and the Middle East conflict. Xeneta said that this month-on-month decline in spot rates, and a slowdown in the pace of year-on-year rate growth from 38% in June and 41% in May, was a sign of a weakening market. Demand growth in July also narrowed from the 8% improvement registered in June. "The rate premiums airfreight buyers have paid since the escalation of the Middle East conflict in late February are continuing to unwind, with little evidence of a peak season boost for airlines and forwarders to look forward to, as the global air cargo market faces a slower second half of 2026," said Xeneta. Xeneta chief airfreight officer, Niall van de Wouw added that there were minimal conversations regarding charter capacity for the peak season. "Very few people are talking about peak season," said van de Wouw. "In all the conversations we've had with our shipper community, in only one was there talk of peak season charters. "This is another signal of the lower expectation for the coming months," he added. The company recently upgraded its demand outlook for the year, but this was largely based on performance in the first half as opposed to expectations for the end of the year. As a result of the weaker market conditions, Xeneta is expecting rates to continue to ease as the year progresses. "Airlines will be fighting tooth and nail to avoid reducing rates as quickly as they went up. It's not in their interests to lower rates quickly, but there is some relief for shippers with the market on a downward trajectory year-on-year," explained van de Wouw. "Rates are swinging backwards, and we expect that to continue, despite the situation in the Middle East still being unclear." Another development that has affected the air cargo market in July was the European Union's implementation of a €3 customs duty on low-value parcels imported from outside the bloc. Xeneta said that this development contributed to spot rates from Northeast Asia to Europe falling 13% month on month, with Southeast Asia to Europe down 9%. "Most striking was China to Western Europe, where spot rates fell 22% month on month to $4.15 per kg - a far steeper July decline than the low single-digit falls seen in the same period in the last two years," the analyst said, adding: "Market reports already point to freighter capacity being withdrawn from China-Europe e-commerce services." The other hot topic of the year has been the rise in AI shipments on the transpacific trade, with rates again up to North America. Xeneta figures show that spot rates from Northeast Asia and Southeast Asia to North America were both 33% above late-February levels - although this too has eased from the 41% and 42% levels recorded at the end of June.
Source: aircargonews.net
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