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The air freight industry is currently experiencing an increased surge in demand that has been driven by a series of factors that are affecting global trade. The pandemic in 2020 saw the demand for air freight rise as ecommerce purchases increased, and this has left a lasting impact on the industry. Businesses have seen an increased volume of purchases that require rapid transportation, meaning they’ve had to optimise their logistics and seek transport solutions via air to cope with demand.
Air freight levels have steadily been growing, however demand seems to have taken off in 2024 with the director general of the IATA stating that current demand is running a 10% increase compared to 2023. However – air cargo capacity isn’t growing at the same rate. It’s growing at about half that, leading to capacity issues and challenges in matching supply with demand. Let’s take a deeper look at the key factors behind the rising demand for air freight in 2024 and the challenges this puts on the freight industry.
First things first, we need to cover the benefits of air freight and why shippers chose to move their goods by this transport method. The main advantage of shipping by air is that it’s fast, efficient and reliable. Air freight offers the fastest transit times compared to any other transportation method, meaning that goods can be received the same day that they were dispatched in some cases. This is especially beneficial for businesses who move perishable goods, time-sensitive materials or pharmaceuticals.
Additionally, air freight allows businesses to reach even the most remote locations worldwide.
With airports in cities across the globe, air transportation allows businesses to reach markets that may have been inaccessible otherwise.
The past few years have been a rollercoaster for air freight demand, which in turn has led to an increase in rates. Recent global events have affected ocean freight, leading to delays and
disruptions. As a result, many businesses have turned to air freight as a more reliable option to move their goods.
The pandemic in 2020 saw a boom in ecommerce purchases as people ordered goods directly to their homes when in-person shopping was unavailable. In 2024, the demand for ecommerce products remains, especially from online stores such as Temu and Shein, which operate in China. Ecommerce shipments from Asia are typically shipped via air, but this rise in demand has seen a surge in cargo leaving Asia, limiting available space on aircrafts.
Carriers and airports around the world are taking measures to comply with the rising demand. DHL has added capacity at numerous airports globally to expand its network while some airports are looking to develop their infrastructure to handle cargo faster and more efficiently.
In October 2023, the Iran-backed armed group, the Houthis, began a series of attacks on vessels and merchant ships in the Red Sea as a response to the ongoing conflict in Gaza. A year on, the conflict in the Red Sea remains an issue as the Houthis have declared they won’t stop until Israel ceases its attack on Gaza.
The attacks have had a large effect on global trade and shipping routes. The Red Sea acts as a
crucial gateway for vessels to enter the Suez Canal, a key trade route between Europe and Asia that handles around 12% of the world’s global trade. With access to the Suez Canal affected, major shippers have had to opt for the longer, more expensive route via Africa’s Cape of Good Hope which comes with an added six weeks of transit times. For businesses who can’t wait that long for their goods to arrive, air freight has become the preferred option for them. With air freight shipments increasing, so are rates, making air freight a more expensive option than it already was.
While the air freight industry might be booming right now, not every shipment necessarily requires to be shipped via air. Ocean freight remains a viable and cost-effective option for businesses, despite the ongoing Red Sea crisis. By forecasting demand and adjusting shipping strategies, businesses can make more informed decisions about when to use air freight versus other transport methods. Not only will this help to lower shipping costs but also alleviate the growing pressure on air freight capacity.
Partnering with an experienced and reliable freight forwarder can be crucial in making these
decisions. At Jenkar, we have over 45+ years worth of experience and knowledge in the freight and logistics industry, allowing us to provide insightful advice and solutions to our customers. Our team of experts will work closely with you to understand your budget, your requirements and your cargo to build a tailored solution that’s best for your business.
As global trade continues to evolve and global events continue to affect the industry, partnering with a freight forwarding company is more important than ever. We can help you navigate the complexities of the industry and ensure every one of your shipments is seamless and secure. Get started with Jenkar today by contacting a member of our team.
Stay up to date with the latest trends, news and updates in the freight forwarding industry to ensure that your logistics operations are always optimised for efficiency.
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