Singapore Freight Forwarding Services
Air & Sea Freight Between Singapore and the UK

AI shippers still looking for capacity risk sharp airfreight peak squeeze

AI infrastructure shippers, still seeking peak-season capacity, could push air freight rates sharply higher, as demand for servers, chips, and data centre equipment adds pressure to an already firm market. According to TAC Index, sources have reported that ecommerce customers and other major shippers with product launches had secured peak-capacity, while some AI hyperscalers had yet to book their space. The warning comes despite a Golden Week dip in TAC's global Baltic Air Freight Index, which fell 2.1% in the seven days to 12 October, leaving it 24.3% above a year earlier. China's holiday ended on 7 October. While overall rates from China to Europe and the US softened over the week, nearly all TAC's spot rates out of Hong Kong, Shanghai, and Korea rose, with increases particularly evident in recent days. New analysis of US imports underlines the scale of technology-related demand. Supply chain professor Jason Miller's seasonal adjustment of Census Bureau trade data showed August air freight imports by weight reaching another record, up 20% year on year, and 42% above the 2023 average. Computer parts, including GPUs, contributed an additional 12,932 tonnes, compared with August last year, while prepared unrecorded media, including memory, added 11,111 tonnes. Electrical power equipment and insulated wire and cables were also among the leading contributors. Mr Miller said these categories pointed to the "disproportionate role" of investment in the physical infrastructure supporting AI computing in generating freight demand. His findings concern US air imports, but forwarder Forto also identified a broad shift towards technology in its third-quarter market analysis. Semiconductors, AI hardware, servers, and data centre infrastructure were the principal growth drivers, it said, while ecommerce had declined in relative importance. And the changing demand picture is also influencing how forwarders secure capacity. Speaking at an industry event in Liège last month, DSV's global head of airfreight, Stefan Krikken, said forwarders needed to balance firm capacity commitments with more flexible airline bookings and their own flying programmes, taking account of hyperscaler demand and constraints at cargo gateways. Hyperscaler demand was among the factors shaping those decisions, alongside the ability of gateways to accommodate the cargo. Morrison Express has also identified growing hyperscaler production in South-east Asia, and exceptionally high Taiwanese volumes as factors prompting a reassessment of its gateways. However, stronger demand and higher rates may offer carriers less financial relief than the headline figures suggest. TAC reported that jet fuel prices rose a further 3.1% in the week to 9 October, citing IATA's Jet Fuel Price Monitor, taking the year-on-year increase to 111.2%. And in his latest JTD Advisory briefing, founder David Kerr warned that fuel costs were rising faster than freight rates, putting pressure on operating margins. He expects fuel surcharge resets in the second half of October, and identified four-engine freighters as the aircraft most likely to face pressure to reprice, or be parked. Published surcharges already illustrate the pressure on shipping costs. Cathay Cargo's Hong Kong-origin long-haul fuel surcharge rose almost 26%, from HK$11.20 to HK$14.10 (US$1.42-$1.79) per kg, for the first half of October. DHL Air UK's equivalent charge increased 4.1% week on week, to HK$12.80 per kg for 12-18 October, although it remained below its late-September level. Japan Airlines will raise its fuel surcharge on domestic exports bound for the Americas and Europe from ¥185 ($1.16) to ¥192 per kg on 16 October, an increase of 3.8%. Its medium-haul and short-haul Asian surcharges will rise by around 4%. The impact on individual operators will depend on their fuel exposure and ability to recover costs, but the combination adds another pricing risk for shippers seeking remaining peak-season space. For those AI customers still to secure capacity, the question is how much room remains, and what it will cost.

Delta Cargo continues digital expansion with CargoWise roll out

Delta Cargo has continued the recent ramp-up of its digital capabilities through the introduction of an integration with freight forwarder platform CargoWise. The integration will enable CargoWise's freight forwarder users to book, confirm, and manage shipments with Delta Cargo. This will make it "easier for its freight forwarder customers to access Delta Cargo's schedules, rates, and capacity availability", the tech company claimed. "The direct data connection enables freight forwarders working within CargoWise to act on Delta Cargo's live capacity availability and rates in real-time as customer enquiries arrive. "They can tailor bookings by commodity, configure routing options, and easily change bookings, at a speed that manual processes can't match," the company added. Peter Penseel, president of Delta Cargo, said: "Ensuring that Delta Cargo services are easily accessible wherever freight forwarders prefer to work is at the heart of our digital strategy. "By connecting directly to CargoWise, we're expanding the ways customers can access Delta Cargo services through the platforms they use every day, providing the real-time visibility and reliability our customers expect. "This integration is a natural next step to making Delta Cargo easier to do business with and delivering a more seamless customer experience." CargoWise said its customers include 23 of the 25 largest global freight forwarders. The airline has been busy advancing its digital presence this year. In August, the airline placed its cargo capacity on third-party online booking portal CargoAi. Meanwhile, in July, Delta Cargo enhanced its booking capabilities with five-day search functionality as part of ongoing digitalisation efforts. The US cargo business said that the ability to search flights over a five-day period as opposed to a single day, would provide customers with greater flexibility.

Delta Air Lines reports another strong increase in cargo revenues

Delta Air Lines has seen its cargo revenues improve by double-digit percentage levels in the third quarter of the year. The Atlanta-headquartered airline registered a 29% year-on-year increase in third-quarter cargo revenues to $301m. The company said the revenue increase was fuelled roughly equally by volume and yield, suggesting an increase of around 15% for each. If the airline's volumes have been increasing by 15%, that would outstrip the average recorded by North American airlines according to IATA figures. The airline association reported that in August North American airlines benefitted from a 6.6% year-on-year increase in cargo tonne kms. Over the first eight months of the year, North American cargo tonne kms have increased by 5.9%. IATA figures show that the fastest-growing major North American trade lane is from Asia where cargo tonne kms were up 13.2% in August, marking seven months of consecutive growth. While Delta has a presence on the transpacific and is targeting expansion on the trade, its main international market is the transatlantic. Europe-North America cargo tonne kms increased by 4.3% in August, according to IATA. Cargo revenues would have also increased on the back of higher fuel prices, which have recently been tracking at more than 100% of last year's levels. During the airline's second-quarter conference call, Joe Esposito, Delta's executive vice president & chief commercial officer, said that the airline was benefiting from the rerouting of cargo away from the Middle East due to the ongoing conflict and also its expansion in Asia.