Disruption to supply chains has continued throughout September with more of the same causals we have seen in previous months and continued short term modal shift to air freight. Demand continues to be strong as economies continue to recover and open after restrictions with a strong peak expected and no likelihood of rates softening until the New Year.

The BAI index finished the month at 4,272 which is the highest level since the index was first reported in January 2018, with the last highest level being 3,975 in mid-May 2020.  

The BAI index finished the month at 4,272 which is the highest level since the index was first reported in January 2018, with the last highest level being 3,975 in mid-May 2020.   This final full week of September level is +80% versus the equivalent week in 2020 and +279% versus 2019.  With the index rising for nine consecutive weeks, it is 21% above levels seen at the end of August.  All the 17 trade lane indexes were positive versus the end of August levels, ranging from a modest +0.3% on Frankfurt to USA, to +83% on Frankfurt to China.

The differences by market in the air freight indices are detailed below.

CN/HK Markets

  • Both the China and Hong Kong markets saw strong improvements in September over August of 24% and 15% respectively and both continued to show gains of ~50% versus last year. All the trade lanes from these markets were positive over August.
  • Both indices (BAI31 & BAI81) to Europe saw similar month on month improvements, 31% and 27% respectively. 
  • This difference by market was large on flows to North America with HKG +6% versus August levels whilst PVG was +24% impacted by capacity constraints.
  • Hong Kong to Southeast Asia (BAI33) finished the month +15% versus the last week of August.

US Market

The market ex Chicago saw contrasting performance to Europe and Southeast Asia.

  • ORD – EUR (BAI51) was up 10% versus last month but only up 7% versus 2020.  However, the latest index was still positive versus 2019 by 179%.
  • ORD – SEA (BAI53) was up 42% versus August and 108% higher than last year with a huge 194% growth versus 2019.

EUR Markets

  • The European market continued to see a mixed performance by lane.
  • FRA – US (BAI24) was a modest 0.3% up versus August and down on last year by -3% although +219% versus 2019. 
  • FRA – SEA (BAI23) was up by 51% over last month and 84% versus 2020 whilst FRA – China (BAI25) was +83% and +130%.
  • LHR – US (BAI44) was up 6% versus August, up 30% versus 2020, and up a huge 478% versus 2019.
  • LHR – SEA (BAI43) was up 15% on last month and 55% versus 2020.

SEA Market

SIN to SEA (BAI63) fell for the third month running but at half the rate of the two previous months at -2% and was flat on last year.  The latest level was still up by 104% versus 2019.

In summary, air freight prices strengthened in all markets and overall, the index was at its highest level since the index was first reported.   Supply chains, both air and sea, are struggling under the strain of strong demand and operational disruption so it would be wise to shop early for the holiday season to avoid being disappointed.