Air Cargo Shippers Not Likely to See a Surge in Pricing Next Year

According to Charles W. “Chuck” Clowdis, managing director, Transportation Advisory Services for IHS Global Insight, this slow growth still reflects rates that have remained stable for most of the past year.

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While Air cargo volumes have crept along at a snail’s pace during most of 2012. The year is apparently going to end without a push for last minute electronics and other higher value retail goods to fill the space on cargo planes to capacity.  According to Charles W. “Chuck” Clowdis, managing director, Transportation Advisory Services for IHS Global Insight, this slow growth still reflects rates that have remained stable for most of the past year.

“Even the strike at the posts of Los Angeles/Long Beach did not last long enough to push goods from sea to air as inventory carrying stocks may have become threatened,” he said in an interview.  “It is our feeling that rates will continue to remain at present levels during 2013’s First Quarter and likely remain so unless there is a discernible economic recovery that will include robust consumer spending.”

Some hope for a recovery exists by next summer, however. Clowdis said mid-year spending may see a bit of an upturn for air freight items if new electronic items are released.

“Likewise consumer spending on relatively high value goods could return with a rise in the economy,” he said. “But this scenario is unlikely looking forward six months or so. Six months into 2013 will find us most likely awaiting a change in the economic situation hopefully coupled with a drop in unemployment.”

Clowdis said that “Back to school” will not have a large impact on air cargo rates in the third quarter of 2013.

“But we feel the industry may eek-out a small, less than 1.5% increase,” he said. “The economy is coming to grips hopefully with the impact of any tax changes or health care costs that will be impacting by September 2013.”


About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]

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