According to Xeneta’s reporting, long-term air freight rates are forecasted to increase between 5% and 15% this year, reversing the earlier expectation of a decline between -5% and -10%. The revision follows a major supply shock following the onset of the Iran war in late February, which immediately removed more than 12% of global air cargo capacity and constrained supply growth to just 1% in the first half of the year.

Xeneta’s data showed that air cargo demand increased by 4% in the same period, surpassing its original full-year forecast of 2% to 3%. This inequality between tightening supply and stronger demand has pushed air freight rates up by 17% year-on-year for both spot and contract pricing.

Spot rates climbed by double digits year-on-year in May before stabilizing. Xeneta’s Chief Airfreight Officer, Niall van de Wouw, said, “On 27 February I would have bet on the Netherlands winning the World Cup before I put money on air rates jumping 40%. Yet that is what happened, with global spot rates up around 40% year-on-year in May.” He pointed out that rates have since leveled off but “are not falling”.

Xeneta said it expected demand growth to ease in the second half of 2026 as capacity gradually returns. This could shift market conditions back in favor of shippers; however, van de Wouw cautioned that similar market turning points have proven unpredictable. He said, “We have been here before, so take nothing for granted”.

Xeneta also noted a divergence in demand drivers. The analyst highlighted that traditional e-commerce volumes have softened, particularly in China, where low-value exports dropped by -7% year-on-year in May. Conversely, demand for AI-related cargo is accelerating. According to Xeneta, AI-related goods account for less than 10% of global air freight volumes but are concentrated in the Trans-Pacific corridor.

Taiwan’s role in the global technology supply chain continues to strengthen, particularly across semiconductors, servers, and related high-value components. As reported by Air Cargo News, Taiwan Semiconductor Manufacturing Company remains the world’s largest contract chipmaker, accounting for more than half of the global semiconductor foundry market and producing approximately 90% of the world’s most advanced microchips.

Reporting from the Taipei Times, citing Academia Sinica, said Taiwan’s economy is projected to expand by more than 10% in 2026, largely driven by this demand for cutting-edge computing technology.

Source: Xeneta, Air Cargo News, Taipei Times