Market Response Weakens Following Conclusion of 'De Minimis' Exemption

In the week of May 5-11, global chargeable weight saw a slight dip of 1%, continuing a trend of declines that began in early April. The only exception was week 17,which maintained steady volumes. When comparing the last two weeks to the previous two (2Wo2W), there was a notable drop of 3% in worldwide tonnage. Interestingly, Europe and North America bucked this trend with increases of 2% and 3%, respectively, likely due to recovery following Easter festivities. The recent end to the US ‘de minimis’ exemption for imports from china valued under $800 on may 2 has further contributed to this downward trajectory in airfreight demand, particularly affecting shipments from China.

As demand wanes, global average rates have also taken a hit for four consecutive weeks—falling from $2.46 in week 15 down to $2.34 by week 19—a decline of about 2%. This drop is consistent with a similar decrease when comparing two-week periods (2Wo2W). Data from WorldACD indicates that over half a million transactions were analyzed during this timeframe. Notably, prices are now down by about 3% compared to the same period last year.Only north America and Europe saw slight price increases—up by around 3% and 1%, respectively—likely due to post-Labor Day recovery.

WorldACD Market Data reveals that asia Pacific led the chargeable weight decline on a two-week basis with an alarming drop of -8%. Central and South America followed closely behind at -5%, largely attributed to decreased flower exports after Mother’s Day celebrations wrapped up. meanwhile, exports from regions like MESA fell by -1%, possibly influenced by ongoing geopolitical tensions; Africa’s volume remained stable throughout this period. On a brighter note, westbound transatlantic traffic experienced growth with an increase in chargeable weight up +6%, driven primarily by front-loading during tariff pauses.

The asia Pacific region faced declines across all sectors; shipments heading towards North America dropped significantly—by as much as -13%—and within its own region fell -12%. These figures reflect growing uncertainties surrounding tariffs alongside reduced activity following Labor Day (May 1) and Golden Week holidays (April 29 – May6).

A mix of factors has been pushing prices downward lately; chief among them is uncertainty regarding US tariffs which has stifled economic momentum and led companies to delay sourcing strategies or investment plans. Pricing dipped most sharply for routes ex-North America heading towards Asia Pacific (-5%), ex-Asia Pacific bound for North America (-4%), along with routes between Europe and both north America and CSA (-3%).Additionally, falling container shipping rates have made airfreight less attractive overall for shippers while airfreight capacity globally contracted by about -2%. Except for Europe—which saw an uptick of +1%—all other regions experienced capacity reductions led predominantly by Asia Pacific’s significant drop at -5%, partly due to Golden Week festivities.

The trade war’s impact hints at shifting demands

The ongoing trade war had already strained airfreight flows before being exacerbated further when the US ended its ‘de minimis’ exemption policy; this change resulted in double-digit percentage drops in volumes originating from China headed toward the US market. In week nineteen alone (May5-11), chargeable weights plummeted by -10% compared to week eighteen (April28-May4), which had already seen declines around -14%. Year-over-year comparisons show that volumes moving from China/Hong Kong into North America were down approximately -27%; marking four consecutive weeks where double-digit decreases occurred consistently across these metrics.

This contrasts sharply with traffic patterns observed between Asia-Pacific countries sending goods into Europe where stability prevailed—the chargeable weights remained unchanged compared against prior weeks.

The upcoming weeks may introduce new dynamics following unexpected developments regarding trade negotiations between China & USA leading many businesses anticipating front-loading activities amidst limited container shipping capacities available currently on market shelves! Moreover—the temporary suspension lasting ninety days concerning elevated tariffs could potentially lower duties applied onto parcels shipped directly originating within Chinese borders destined towards American shores! However—it’s essential also consider customs clearance requirements imposed upon non-postal network shipments adding extra costs & transit times ultimately influencing decisions made surrounding whether or not utilizing air freight remains viable option moving forward!