Chinese air cargo e-commerce volumes under pressure in August

The amount of e-commerce being flown out of China declined in August as the impact of the European Union's (EU) decision to add a charge for low-value packages continued to take its toll on the market. Figures from consultant Aevean show that in August, Chinese air cargo e-commerce exports declined in weight terms by 16% year on year. The decline was driven by a 40% fall in air cargo e-commerce volumes from China to Europe following the EU's decision to introduce a €3 charge for packages worth less than €150 at the start of July. Figures from Aevean show that following the start of the charge, e-commerce volumes from China to the EU declined by 29% year on year in July. E-commerce exports from China to other regions also came under pressure. For instance, volumes to Asia Pacific were down 8% and there were also declines registered to the Middle East and South Asia region and Latin America. Volumes to North America were more or less flat, while to Africa there was a 71% year-on-year increase as the e-commerce platforms refocused their marketing efforts. The year-on-year decline registered in August follows a slowdown in the pace of growth for e-commerce shipments originating in China as countries have clamped down on the duty-free import of low-value packages. The US famously scrapped its de minimis exemption for e-commerce packages in May 2025 while Brazil removed its exemption in August 2024. Since then, e-commerce volumes from China to both the US and Brazil have recovered.

European Aviation completes acquisition of European Cargo aircraft

European Aviation has completed the acquisition of troubled European Cargo's aircraft, including its fleet of A340 cargo aircraft, with plans to restart flights. The company said that it had acquired European Cargo's 16 A340 aircraft, including seven "flight-ready" freighters, a large quantity of Rolls-Royce Trent 553 and 556 spare engines, including several with little time since overhaul. The aircraft acquisition came about after European Cargo fell into administration earlier this year. Also included in the purchase are more than 14,000 line items of spares for the A340 aircraft and Trent engines. News that European Aviation was interested in rescuing the company emerged in August. European Aviation chairman and chief executive Paul Stoddart said: "We are delighted to have concluded our acquisition of all of the assets of [European Cargo] with the joint administrators. "Whilst this is a massive investment from [European Aviation], I feel totally confident that we can keep this excellent fleet of cargo aircraft flying for the foreseeable future." European Cargo began to run into trouble when its largest customer asked for a 30% reduction in service price due to softer volumes. In addition, the wars in Ukraine and in the Middle East resulted in increasing jet fuel prices that negatively impacted the business through reduced profit margin per flight. The airline entered administration in June of this year, with 174 of its 219 staff made redundant. European Aviation, which is owned by ex-Formula One team boss Paul Stoddart, previously owned European Cargo. The company sold 49% of its stake in European Cargo in 2022 and the remaining 51% stake two years later. The airline emerged in April 2020 during the onset of the Covid-19 pandemic, after European Aviation sought to offer the UK government capacity to transport medical equipment from Malaysia. It had been acquiring Airbus four-engined A340-600 passenger jets from carriers such as Virgin Atlantic and initially operated them as temporary freighters. European Cargo subsequently obtained approval to operate the -600s in a permanent cargo configuration, with a 76t payload capability, and has been gradually converting its fleet. The airline had been operating the aircraft between China and Bournemouth and Teesside in the UK, largely carrying e-commerce shipments. No cargo door is added during the conversion process, allowing the aircraft to potentially be turned back into passenger aircraft in the future, but making the cargo loading process more complicated than on a fully converted freighter. European Cargo's most recent financial statement shows it made a full-year net loss of $26m in 2024 -- on revenues of $136m -- a slight improvement on its net loss of $30.6m in 2023.

Transpac rates close in on Covid records as carriers pile in capacity

Container shipping spot rates from the Far East to the US are approaching their highest levels seen during the Covid-19 disruption, with carriers increasing capacity on the eastbound transpacific as they seek to capitalise on the surge. According to Xeneta chief analyst Peter Sand, spot rates from the Far East to the US west and east coasts have risen by 324% and 325%, respectively, since 28 February, before the Hormuz crisis. The average spot rate on 17 September was $7,960 per feu to the US west coast and $11,259 per feu to the US east coast. That leaves the west coast rate 17.9% below its Covid-era record of $9,699 per forty foot, set in February 2022, while the east coast is 11.2% below its peak of $12,683, reached in January 2022. "That leaves freight rates on these critical trades just 18% and 11% short of the all-time high set during the Covid-19 disruption. With bunker prices pushing fuel surcharges higher, surpassing the pandemic peak cannot be ruled out, which would be an extraordinary market development," said Mr Sand. "If a freight rate record is broken, it is most likely to occur on the trade into US East Coast, but even if we do not see a new all-time high, the fact we are even discussing the possibility demonstrates how sensitive critical ocean container shipping trades are to geopolitical forces and how a regional conflict in the Middle East can have major implications at a global level." Carriers are responding to the strength of the transpacific market by adding capacity, particularly to the US east coast. Xeneta said offered capacity on the trade is 6-7% higher in September than in August. "Carriers are seizing the opportunity while the market is hot, adding capacity into US East Coast ahead of what could be a turn in the market within the next two to three weeks. Offered capacity on the Far East to US East Coast trade is 6-7% higher in September than in August," Mr Sand said, and added he expects another rate increase as shippers bring forward cargo ahead of China's Golden Week holiday. "We should expect one more freight rate push at the start of October as shippers rush cargo out of Asia ahead of the Golden Week shutdown, before rates start to soften, or at least the pace of growth will slow." Separate analysis from Sea-Intelligence pointed to improved carrier capacity management as a key factor behind elevated transpacific utilisation. Eastbound transpacific vessel utilisation has risen from typically 80-85% in 2018-19 to around 85-90% in recent years, with 2026 levels around eight percentage points above the pre-pandemic period, according to its data. "The root cause of the increased utilisation appears to be a stronger discipline in capacity deployment by the carriers. This does not imply collusion across competitors, but indicates that carriers have become better at adjusting capacity on the trade, to match the rapidly shifting demand fluctuations." While geopolitical disruption, disciplined capacity deployment and shippers advancing cargo ahead of Golden Week are keeping the transpacific market tight, with rates within striking distance of their pandemic-era records, maintaining tight capacity could become more challenging as major carriers seek to grow market share, potentially putting pressure on utilisation and freight rates. Maersk's orderbook now stands at 35% of its existing fleet following an order for 26 large vessels, while MSC, CMA CGM and Cosco have orderbooks equivalent to 39%, 39% and 52% of their current fleets respectively.