Global airfreight rates are expected to spike sharply as the ongoing conflict in the Middle East disrupts cargo capacity, according to consultant and data provider Xeneta. The firm has advised shippers on affected trade lanes to delay signing longer-term contracts until market conditions stabilize.
Niall van de Wouw, Xeneta’s chief airfreight officer, said global airfreight capacity has fallen by 16-18% as carriers have been forced to ground operations and cancel flights due to the outbreak of war in the region. He cautioned, however, that the impact is uneven, with some markets seeing far more dramatic disruptions than others.
“Take India as a key example. Capacity out of that market is dominated by Qatar, Emirates, and Etihad, which are no longer able to serve it,” van de Wouw said. “So while 16-18% may mean a low single-digit impact in some markets, in others it can reach 50, 60, even 70%.”
The ripple effects are expected to extend beyond direct Middle East routes. Services connecting India via hubs such as Istanbul could see rates climb as airlines adjust to capacity shortages, he noted. “Even if you’re not operationally affected, you will be commercially affected because carriers able to operate will optimise their positions,” he said.
Drawing parallels with the Covid-19 pandemic, van de Wouw warned that freight rates could “double, triple, or even quadruple” in some markets if the crisis continues. He highlighted the crippling impact on major carriers, including Qatar Airways and Emirates, which dominate global airfreight.
Cargo currently stranded in the Middle East may face delays, though freight forwarders holding shipments could find alternative routes, albeit at higher costs. Charter operations are expected to rise as companies seek to bypass disrupted lanes.
“Load factors from Asia to Europe were around 80% before the crisis — our tipping point between a buyer’s and seller’s market. Take away 10% of capacity and you’ll see a scramble for space,” van de Wouw explained. “Charters will come at a significantly higher rate than before the conflict.”
He advised shippers negotiating annual deals to postpone discussions for affected trade lanes. “Any longer-term rate agreed now could be far too expensive if the situation resolves quickly or too cheap if it drags on. The safest approach is to stay close to your freight forwarders, live with the uncertainty, and set longer-term agreements once the market stabilizes,” he said.
