Air freight rates are now expected to rise this year rather than fall, analyst Xeneta said in its Air Freight Outlook 2026 Mid-Year Update, reported by Air Cargo News on July 17, 2026. Shipper long-term rates, which Xeneta forecast in December would fall 5% to 10% over 2026, are now expected to rise 5% to 15%. The firm attributes the change mainly to the supply shock caused by the escalation of conflict in the Middle East in February.
According to Xeneta, the escalation on February 28 removed 12% of global air cargo capacity overnight. Supply grew just 1% in the first half of 2026 while demand grew 4%, and global rates, combining spot and long-term contracts, rose 17% year on year. Spot rates were up around 40% year on year in May; chief airfreight officer Niall van de Wouw said they are now plateauing but not falling. For the full year, Xeneta expects demand growth toward the top of a 2% to 3% range and capacity growth toward the bottom of a revised 2% to 3% range, down from the 3% to 4% it published in December.
The mix of freight is changing as well. AI-related goods are less than 10% of total air cargo volumes but are concentrated on the transpacific, which Xeneta calls the year’s strongest trade corridor; global semiconductor sales rose 106% year on year in April. E-commerce is going the other way: China’s low-value and e-commerce exports fell 7% year on year in May, a sixth consecutive monthly decline, according to Xeneta’s data. “Demand keeps defying gravity,” van de Wouw said. He expects demand growth to ease in the second half while supply continues to recover, which would tilt the market back in shippers’ favor, and he warned that further shocks are possible.
What it means for shippers
- Contract renewals are likely to cost more. If an air freight contract or tender comes up this year, expect offers above last year’s level and ask exactly what is included: fuel, security and handling charges.
- Spot may soften before contracts do. With spot rates flat and supply recovering, think about how much volume to fix and for how long. Your forwarder can lay out the options.
- Transpacific space is contested. Shipments from Asia into West Coast gateways such as LAX share aircraft with high-value technology cargo. Book early and give accurate dimensions and weights.
- Plan for the next surprise. Xeneta expects another disruption at some point. Agree a second routing in advance, and an ocean alternative for freight that is less urgent.
Go Trucking Services handles air freight and LAX CFS pickup and delivery for shippers in Greater Los Angeles — see Air Freight and Drayage, or request a quote on the home page.
Sources:
Image: 4300streetcar, via Wikimedia Commons (CC BY 4.0).
