Air cargo volumes from China and Hong Kong to Europe declined for a sixth consecutive week, as new European Union (EU) import regulations introduced on 1 July continue to drive up costs and operational complexity. The downturn has weighed on global growth and contributed to falling freight rates worldwide.
According to the latest data from WorldACD Market Data, chargeable weight from mainland China to Europe fell by a further 5% week-on-week (WoW) in week 31 (27 July to 2 August), while Hong Kong recorded a 3% WoW decline. Year-on-year (YoY), volumes dropped by 7% from China and a sharp 24% from Hong Kong. For the full month of July, Hong Kong-Europe tonnages were down 19% compared with June and 24% lower than July last year.
Mainland China volumes have proven more resilient than Hong Kong’s e-commerce-driven market, which has been more heavily impacted by the removal of the EU’s tariff-free exemption for goods valued under €150. Tonnages from China to Europe declined by 3% month-on-month (MoM) in July and were down 6% YoY. Combined China and Hong Kong volumes to Europe fell 9% MoM and 12% YoY.
Falling spot rates intensify pressure
Spot rates on China-Europe lanes have also been in steady decline over the past six weeks. Rates from Hong Kong dropped from $5.80 per kilo in week 25 to $4.96 in week 31, a 15% decrease. From mainland China, rates fell more sharply, from $5.43 per kilo to $3.86, marking a 29% drop, based on over 500,000 weekly transactions tracked by WorldACD.
Although spot rates in week 31 remained slightly above last year’s levels—up 2% from China and 7% from Hong Kong—the premium has narrowed significantly from the roughly 25% increases seen in previous months. Across the wider Asia Pacific region, rates remain elevated YoY, including Taiwan (+33%), Vietnam (+39%), and Thailand (+32%). However, the overall Asia Pacific to Europe rate increase has eased from +39% in week 25 to +17% in week 31.
In July, spot rates from Asia Pacific origins to all destinations declined 10% MoM to an average of $4.75 per kilo, though still 29% higher YoY. Globally, average spot rates fell 8% MoM to $3.41 per kilo, also maintaining a 29% YoY increase.
All major air cargo origin regions recorded MoM declines in July, although most remain at least 20% above last year’s levels, except Central and South America, where rates are up by just 5% YoY. Elevated pricing continues to reflect high fuel surcharges driven by increased jet fuel costs linked to geopolitical tensions, alongside supply-demand imbalances and strong demand from sectors such as AI-driven data centre infrastructure.
Global volumes show slower growth
Despite the downturn on key China-Europe routes, global air cargo volumes rose 2% in July compared with June, with total chargeable weight up 5% YoY. However, this marks a slowdown from the 9% YoY growth recorded in June.
Growth from Asia Pacific origins nearly halved, dropping from 11% YoY in June to 6% in July. Europe saw growth ease from 8% to 3%, while Middle East and South Asia (MESA) declined from 12% to 4% YoY.
Global capacity edged up 1% WoW in week 31, supported by a 5% recovery in MESA markets following easing tensions in the Gulf, and a 2% rebound in Asia Pacific capacity after disruption from a recent typhoon. However, MESA capacity remains around 11% below pre-conflict levels recorded in week 7, with Gulf capacity still 20% lower despite recent improvements.