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Transpacific trades in unchartered water, with tariff uncertainty at the helm

A declining sales-to-inventory ratio in the US has been one of the key reasons behind the recent volume surge and accompanying spot rate rally on the transpacific trades. However, while new data from the US Census Bureau for May shows the gap continued to widen that month, analysts at Sea-Intelligence warned that while the ratio was decreasing, inventories are on the rise, and any drop-off in US consumer spending would reverse the situation, resulting in an inventory overhang. "This is not necessarily a stable situation. It is solely the relative inventories which are declining. The absolute size keeps growing," Sea-Intelligence said. "This means it is the sales data which are important. The resilience of the US consumer is what is lowering the relative inventory sizes," it added. Surging sales in May, as well as the impending end of the universal 10% tariffs, clearly prompted US importers to ship more goods the following month, and the port of Los Angeles - often a bellwether for the country's container supply chains - reported its busiest-ever June, handling 1.002m teu, only the third time it had handled more than a million teu in a single month. "June cargo was 12% higher than a year ago, driven by strong import demand as retailers and manufacturers continued advancing shipments while navigating evolving trade policy, rising fuel costs, and global supply chain uncertainty," the port authority said. However, US forwarders are well aware that much of the recent transpacific demand has been influenced by President Trump's tariff policies - and the huge cloud of uncertainty that looms over them - and is clearly correlated with the inventory-to-sales ratios. "The next two weeks are likely to determine the direction of the transpacific market," US west coast forwarder Freight Right said last week. "If tariff uncertainty is resolved with lower or eliminated duties, import demand could quickly rebound, potentially creating an extended peak season through August and September, and pushing ocean rates higher again. However, if tariffs remain, or increase, market participants expect booking volumes to weaken further, putting additional downward pressure on freight rates." The forwarder added: "With many importers already front-loading inventory earlier, the industry may ultimately experience another year without a traditional peak season, instead seeing demand shift around trade policy developments rather than seasonal retail cycles." And if US consumers decide to stop spending it would put another dent in transpacific demand, colliding with a more benign tariff environment, Sea-Intelligence noted. "Should sales begin to decline, the relative inventories will increase instantly, leading from low inventories to excess inventories. If this happens in the coming months, the swing will occur just as we see record amounts of containerised cargo delivered into the US. "Should such a scenario unfold, this also means we will see the demand surge and associated full vessels and high freight rates rapidly replaced by overcapacity and dropping freight rates," it added.

Air Cargo India flies first international export shipment out of Navi Mumbai

Air Cargo India said it has transported the first international export shipment from the new Navi Mumbai International Airport. The 1.79-tonne consignment, comprising crates of freshly harvested guavas and Drumstick Moringa - the pods of the tropical Moringa oleifera tree, was carried on an Air India Express passenger flight to Abu Dhabi on 15 July, the first day of international flights at Navi Mumbai. Air India Express is operating three times weekly on the route using a Boeing 737-8 aircraft that offers approximately 2.5 tonnes of belly-hold cargo capacity. The capacity on the route supports the movement of perishables and time-sensitive goods from western India to the UAE and the wider Gulf region, and Air India Cargo expects the service to carry around 25 tonnes of cargo each month. "Every new route presents an opportunity," said Ramesh Mamidala, head of cargo, Air India. "This first export shipment from Navi Mumbai connects growers, traders and businesses in western India directly with one of the region's most important international markets. "Fresh produce is highly time-sensitive, and reliable air connectivity plays a critical role in helping Indian exporters reach global consumers while preserving product quality." Air India Cargo said it has steadily strengthened its capabilities over the past several years to support the growing movement of perishables, pharmaceuticals and other temperature-sensitive commodities across its network. Its cargo operations are supported by specialised equipment, including cool dollies and thermal blankets, designed to minimise temperature fluctuations while shipments move between warehouse and aircraft. "Cargo is often the unseen enabler of trade," said Mamidala. "When we transport perishable products such as fruits, vegetables or temperature-sensitive pharmaceuticals, speed alone is not enough. "Maintaining the integrity of the shipment from origin to destination is equally important. Investments in cold-chain infrastructure and globally certified handling processes are helping us support exporters with the reliability they need." For growers and exporters across Maharashtra, reliable air cargo links can make the difference between accessing local markets and reaching international consumers willing to pay a premium for fresh produce, stressed Air Cargo India. "The Gulf has long been a strong market for Indian produce," Mamidala said. "By making additional capacity available from Navi Mumbai, we are creating faster and more efficient pathways for exporters while strengthening India's agricultural export ecosystem. Every shipment represents the efforts of farmers, traders, freight forwarders and logistics partners, and our role is to connect them to opportunities beyond India's borders." Developed by Adani Airport Holdings and CIDCO, Navi Mumbai International Airport officially commenced domestic commercial operations on 25 December. Earlier this week, Cathay Cargo revealed that it would shift its freighter operations to Navi Mumbai International Airport from Mumbai's Chhatrapati Shivaji Maharaj International Airport as upgrade work is being carried out there and freighter operations are suspended.

APAC-Europe air cargo volumes drop 15% year on year

Air cargo volumes between Asia Pacific and Europe have dropped, with ex China volumes taking a hit and ex Hong Kong volumes continuing to decline. For Asia Pacific as a whole, volumes to Europe were down 10% week on week and 15% year on year, shows figures from WorldACD Market Data. Volumes from e-commerce hotspot Hong Kong were down 23% year on year, after four consecutive week on week declines, according to the week 28 (6-12 July) figures from WorldACD. The decline followed the end of the EU's de minimis exemption and its introduction of a temporary €3 customs duty on low-value parcels imported from outside the EU as of 1 July. This decline in volumes reflected "the impact of the removal by the EU of de minimis import tariff exemptions since 1 July", said WorldACD. EU member states agreed in December to introduce the customs duty charge per item on parcels valued below €150. This is intended to bridge the gap until the EU Customs Data Hub is launched in 2028. In addition to a drop in air cargo volumes from Hong Kong, air cargo volumes from e-commerce hub China were down 13% week on week and 15% year on year. Plus, volumes from Taiwan to Europe were down 24% week on week. WorldACD noted that in terms of week on week impact, typhoon Bavi "particularly affected capacity and chargeable weight from Taiwan and to a lesser extent volumes and capacity from China and other parts of East Asia".