Demand continues to be strong in the air freight industry as economies recover, eCommerce continues to thrive, and the sea freight industry continues to suffer from capacity and operational challenges.  Airlines’ passenger operations are increasing and reducing available belly hold capacity and opportunities for cargo only services.

The BAI monthly average increased by 2% in July over June but was 6% below the year to date high seen in May and saw week-on-week reductions in the final two weeks of July. 13 of the 17 trade lane indexes saw an increase over June.  

The overall index was positive versus last year at +38% and versus 2019 by +98% reflecting the continuing strength in demand and constraints in capacity.

There continue to be differences by market in the air freight indices as can be seen below:

CN/HK Markets

  • Both the China and Hong Kong markets saw an improvement in July over June, 2% and 5% respectively, after large declines in June. All the trade lanes from these markets were positive over June.
    Both indices (BAI-PVG01 & BAI-HKG01) to Europe saw robust improvements, 5% and 3% respectively, however this did not reverse the declines of 9% and 8% in June versus May.  Both indices were up over 70% versus 2019 levels.
  • Whilst HKG to North America (BAI-HKG02) was relatively flat at +0.2% versus June levels, PVG to NA (BAI-PVG02) was +5%.
  • Hong Kong to Southeast Asia (BAI-HKG03) recovered the 4% decline seen in May.

US Market

The market ex Chicago recovered three points of the five lost in June versus May.

  • ORD – EUR (BAI-ORD01) was up marginally by 0.5% to $1.62, down 5% versus last year but up 69% versus 2019.
  • ORD – SEA (BAI-ORD03) was up 7c or 5% to $1.55 and 28% higher than last year and 9% versus 2019.

EUR Markets

The European market improved versus June with average rates up 2% ex Heathrow and Frankfurt for July, although the growth versus 2019 differed significantly with Frankfurt +62% and Heathrow up a staggering 202%.

  • FRA – US (BAI-FRA04) at 3.86 was up 2% or 8c compared to June. 
  • FRA – SEA (BAI-FRA05) was up by 9% or 11c in July over June.
  • LHR – US (BAI-LHR04) at 5.11 was down 2% of 11c versus June.
  • LHR – SEA (BAI-LHR03) was up a modest 0.4% on June to 1.82.

SEA Market

SIN to SEA (BAI-SIN03) fell by 4% for the second month running, was also down on last year by 1%, but up 103% versus 2019.

In summary, air freight market prices were up in July but did not recover back to the highs seen in May.  Prices continue to be strong versus last year and pre-pandemic levels and this is expected to be the case for the foreseeable future as demand continues to outstrip supply.


Gareth Sinclair, Advisor to the Board, TAC Index

Gareth started with British Airways Passenger Business in Financial & Commercial management roles almost 30 years ago. In 2007 he joined British Airways World Cargo, driving significant transformation in Pricing and Revenue Management systems. As Head of Revenue Management and Pricing for IAG Cargo, he introduced enhanced analytical capabilities, dynamic bid price vectors and the move towards dynamic pricing.