After uneasy periods, punctuated by sharp declines and rapid rises, air cargo demand appears to be finally stabilizing. This is a relief to multiple sides of the air freight industry, where the instability and potential long-term damage have been watched with bated breath. Questions, however, continue to remain: How long will this ‘stability’ last? Will the chaotic state of the market return? And what can, if anything, the air cargo community do about it?
Tonnage Stabilization
According to WorldACD Weekly Air Cargo Trends #34 – August 17 to 23, 2026, there has been, for instance, stabilization of the air cargo tonnages going from China and Hong Kong to Europe. This comes after several straight weeks of declines, influenced by the new European Union import duty rules. Brandon Fried, of the AirForwarders Association, corroborated this, saying, “Yes, the WorldACD numbers match what our members are seeing. Demand and pricing have leveled off after the usual start-of-year dip, and worldwide rates have sat around levels still well above where they were a year ago.” While, this is good news for the industry, it isn’t the whole story.
Causes of Instability
The fluctuations in air cargo demand and rates have had many different sources. Removal of de minimis, the war in Iran, and the USA tariff regime, amongst other things, has caused widespread difficulties to the industry. Recovery has been a slow and difficult process, marked by attempts to find alternatives to routes and practices which no longer function in this volatile time. Still, the industry is nothing if not adaptable, as the statistics show. Despite the challenges, there have been solutions found to the troubles that have been plaguing the air cargo industry.
The changing of de minimis in both the USA and EU has had strong impacts on the shipping industry, particularly smaller shipments usually purchased online. Air carriers and freight forwarders have had to adjust to that. According to Brandon Fried, “Forwarders and carriers are rebuilding around formal entry. Every one of those sub-$800 parcels that used to clear with almost no paperwork now needs a real customs entry, a 10-digit classification and duty paid, and the volume that fell off after the US suspension was enormous, better than half in the low-value segment. So, members are staffing up their brokerage and compliance operations and leaning hard on automation to process entries at that scale, because doing it by hand doesn’t pencil out when the brokerage cost per parcel can top the value of what’s in the box.”
In regard to the carrier side, he said, “On the carrier side, some of that B2C belly demand has softened, and you’re seeing a shift toward bulk B2B moves with fulfillment centers set up here and in Europe, closer to the customer. A fair amount of the cheapest product is drifting to ocean. If anything, the forwarder matters more in this environment, not less, because somebody has to make the compliance work.”
Iranian conflict has strongly affected the industry, especially pharma and healthcare cargo. When asked about the specific problems, Brandon Fried said, “So much temperature-controlled product, the generic drugs and active ingredients coming out of India, the cancer therapies that need tight cold-chain handling, moves through the Gulf hubs at Dubai, Doha and Abu Dhabi. When those airports and the big Gulf carriers got disrupted, that traffic had nowhere easy to go and rates spiked hard. Perishables took a similar hit. The knock-on effect landed on Asia-Europe shippers generally, since Gulf freighter capacity is really the backbone of those lanes, and losing it pushed everyone onto longer, more expensive reroutes.” This is clearly a huge problem. Since these products are not only desperately needed, but require extremely specific time frames, the damages could be immense. Rerouting is a solution, but the reroutes must be on a strict schedule, to prevent expiration or similar issues.
Congestion is also a problem for air cargo, and one that is difficult to solve. While some parts of it are being handled, new issues constantly arise. For instance, Brandon Fried said, “The gateway gridlock people worried about has eased in a lot of places, partly because the de minimis changes pulled a big chunk of e-commerce parcels out of the system. What hasn’t gone away is the capacity constraint underneath it. There simply aren’t enough freighters, the order backlog at the manufacturers runs into the thousands, and IATA doesn’t expect that to normalize until early next decade. So instead of one big congestion story, you get periodic hotspots. In the United States, our members still report delays at major airports, so we are continuing to pursue funding for improvements in those cargo areas.” The AirForwarders Association is at the forefront of pushing for air cargo congestion solutions, but pushing only goes so far. Funding is necessary to solve the issues that periodically continue to arise.
Hope for the Future
The current stability is a good sign, but it is only a sign. It is entirely possible for the industry to crash once again. It is not yet time to relax. It is still very important to come up with alternative routes to avoid dangerous zones, to create new practices, and to be prepared to replace any solution that is no longer working. As long as everyone is prepared, the air cargo industry can weather the changing times. Even in the case that the slump returns, and more sharp declines occur, it should be possible to get through it all.
