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AI cargo moderation expected as growth slows

Demand growth for AI-related shipments is starting to slow down despite continued investment in the sector, according to Rotate. Speaking at the Air Cargo Forum in Miami, Ryan Keyrouse, chief executive of the air cargo consultancy and data firm, said that cloud computing exports from Asia Pacific tripled in 2025. However, demand and growth have since slowed and normalised. Monthly demand growth for this vertical began steadily rising in January 2025 and peaked at around 10% in the middle of last year but has since slowed. Meanwhile, total monthly cloud computing volumes peaked at just under 100,000 tonnes in April 2026, but as of August, the monthly total had fallen to around 85,000 tonnes. Kerouse said that there is a strong correlation between AI investment and air cargo volumes, but he questioned whether the recent slowdown in AI-related air cargo volumes means this correlation is beginning to weaken. Research presented by Roate shows that worldwide AI spend will hit $2.7trn this year and $3.6trn in 2027. "While there is this incredible rise (in AI cargo volumes), it is flattening out. The key question is what will happen next year. Spend correlates quite well with tonnage. Next year we're expected to invest more in CAPEX," said Keyrouse. Keyrouse added: "It's interesting, the dynamic where (AI) has been growing and slowing down, and investments in CAPEX were there, which would suggest continued growth. The real question is, will it continue?" He added: "This conflicts with the data which shows AI-related cargo slowing down and plateauing, though." There is good reason to be concerned about the growth sustainability of AI cargo, he said. Keyrouse said several people in the air cargo industry had raised whether "regulatory, capacity and energy issues" would contribute to a slowdown in the AI-market. While these question marks hang over the market, a survey carried out by Rotate shows that overall, the air cargo market remains positive for the outlook of AI-related volumes, even if the rate of growth does come down. Keyrouse said: "The majority of air cargo professionals believe that it will continue growing but it will be much more moderate than it has been." Rotate is also looking into where AI is growing. The majority of AI shipments out of Asia have been flown to the US, with the remainder spread evenly to the rest of the world. Production and transit hubs now include Singapore and Mexico, and data centre markets include India, Malaysia and Thailand. The next emerging AI-related region could be the Middle East as there are plans to open the "Stargate UAE" AI data centre, stated Keyrouse. Keyrouse added that cloud and AI, including cloud computing, computers and parts, and semiconductors, accounted for 33% of air cargo demand growth in January to July this year compared to the same period in 2024.

Shipping $ Series: SITC shareholders in line for bumper payout

Hong Kong-headquartered intra-Asia carrier SITC has seen its share price hit record highs in recent days after its board last week voted to approve a special dividend, returning some HK$5.4bn (US$688m) to shareholders. "The board is pleased to announce that it has resolved the declaration and payment of the special dividend of HK$1 (equivalent to US$0.13) per ordinary share of the company to be payable to the shareholders whose names appear on the company's register of members at the close of business on 11 December 2026," it said in a Hong Kong Stock Exchange (HKSE) filing on Friday. According to the CapitalIQ platform, 49.1% of SITC's stock is freely floated on the HKSE, amounting to 2.71bn shares, with the remaining 51.9% held by a British Virgin Islands company. Its share price closed on Monday at HK$47.9, just shy of the record HK$52 seen on 13 October, shortly after the special dividend was first proposed. It is further sign that investors in shipping stocks are having bumper year, in what Loadstar Premium's DeskOne has labelled the "Shipping $ Series", a moniker prompted by a similar "extraordinary special dividend" issued earlier this month by non-operating shipowner Danaos. The Greek shipowner, listed on the New York Stock Exchange, has also seen its stock price break all records in recent weeks, and notified the market it was issuing a $5 special dividend to shareholders in mid-October. Meanwhile, approval of SITC's special dividend followed the release of its unaudited operational performance for the first nine months of the year, which showed the intra-Asia carrier remarkably insulated from most of the geopolitical events battering large parts of the shipping industry. It reported carrying 2.91m teu during the period, a 5.9% increase on the 2.75m teu it carried in the first nine months of 2025. Meanwhile, according to Container Trades Statistics (CTS) data from the first eight months of 2026, intra-Asia volume growth stood at 8.6%. Although this could be interpreted as SITC losing market share, given the continued strength of the intra-Asia trades it is unclear whether SITC could have taken advantage of that market growth, considering the rather limited capacity of its vessels. As Alphaliner explained in a September analysis, while SITC is the sixth-largest intra-Asia carrier in terms of fleet capacity, the five larger carriers are all mainline operators that deploy considerably larger ships in the trade than the specialised regional carriers. Alphaliner data shows the average size of a deepsea carrier's intra-Asia vessel at 2,699 teu, "more than double the 1,338 teu average for regional carriers". SITC's average ship size is 1,444 teu. Alphaliner added: "SITC, the leading regional carrier in intra-Asia, makes the point vividly: it runs 109 ships, but its considerably smaller average vessel size leaves its total capacity at 157,000 teu, well behind Maersk and Cosco, putting SITC in sixth spot. "This is in line with SITC's focus on direct services to smaller and niche ports in Asia, rather than competing on scale. SITC is the only carrier on the list besides Maersk (108 ships) and Cosco (122 ships) that operates a fleet of more than 100 vessels in the region," Alphaliner wrote. However, its nine-month earnings appeared to be above market average, with its average freight rate (excluding slot exchange fee income) sitting at $825.90 per teu, "representing an increase of approximately 9.4% from $754.90 per teu for the corresponding period in 2025". CTS's intra-Asia price index for the first eight months shows overall growth of 5.3%, with declines in the first three months completely reversed in the following half year. SITC group revenue for the first nine months was up 14.2%, to $2,808.1m, it said in the HKSE filing.

Under-pressure UK transport and logistics firms "dodge Budget bullet"

UK logistics groups welcomed the decision in today's new budget to maintain a 5p-per-litre fuel duty cut and avoid planned increases, and ensuring warehouse rates do not rise, but there have also been warnings that businesses continue to face significant cost pressures. In his first budget as chancellor - and first for the new Burnham government - John Healey rowed back plans to increase fuel duty by 3p per litre in January, followed by a further 2p rise in March, to ease some of the burden on the UK's supply chains. Logistics UK chief executive Ben Fletcher said the move was a "a wise decision" that would help keep trade moving, support economic growth and avoid adding to the already substantial inflationary pressures. "We are delighted that that the Chancellor has listened to Logistics UK's strong case for maintaining the duty cut at a time of global uncertainty and rising costs for businesses and consumers," Mr Fletcher added. Describing the price freeze as "the right call," Road Haulage Association managing director Richard Smith said operators remained under severe financial pressure, citing the additional £385 per week hauliers were paying in fuel despite 85% reporting reduced margins. Mr Smith said that the RHA has "been clear: a fuel duty hike is a food price hike, and with businesses and households struggling with additional fuel costs, the decision to keep prices frozen will offer some relief," but stressed "ministers should have gone further". "The government can still support our sector as critical national infrastructure. A 15p per litre fuel duty rebate for essential users, similar to schemes elsewhere, would provide cashflow support, keeping many more haulage, coach and van operators in business," he continued. Elsewhere, the UK Warehousing Association (UKWA) welcomed the decision not to increase business rates on large warehouses, with chief executive Clare Bottle saying it was "a bullet dodged" after weeks of concern about higher property taxes. "The UKWA has led the charge to persuade the government that a rise in property taxes for warehouses would inexorably lead to higher costs for business and consumers, and we are pleased our argument has been heeded," she said. However, Ms Bottle warned seven in 10 large distribution warehouses remained subject to the high-value business rates multiplier as operators faced rising fuel and employment costs, while also criticising policies that left businesses outside favoured sectors at a disadvantage. Sharing the general view that the fuel duty freeze was a smart one, Metro Shipping offered a cautiously optimistic assessment, highlighting the more resilient growth forecasts and the removal of import tariffs on over 100 products. In a statement, the company said that "whether the wider optimism translates into stronger trading conditions remains to be seen, but global container volumes are already setting new records".