Tuesday, October 20, 2026
The news that moves freight
Air Oct 12, 2026 · 8 min read

Air cargo enters peak 25% dearer than last year, and fuel has not hit yet

Air rates are up 25% on last year. The fuel bill comes next. Global air cargo rates in September were 25% higher than a year earlier, WorldACD says, on tonnage up 9%. Our view: that is the cheap part. Jet fuel was up 108% year on year by 2 October, TAC Index reports, citing IATA and Platts data. TAC says rates “had not risen yet anything like so much as jet fuel prices”. Fuel is typically 25% to a third of airline costs. Forwarders should build surcharge changes into every peak quote. Our call: at least two big cargo airlines raise fuel surcharges on Asia long-haul before mid-November.

Air cargo starts peak season 25% dearer than last year, and the fuel bill has not arrived Air cargo rates worldwide were 25% higher in September than in September 2025. That is the full-market figure from WorldACD, the air cargo data firm, in its report of 12 October. Tonnage was up 9% on the year and up 3% on August. In WorldACD’s words, tonnages “bounced back strongly in September following their August lull”.
On its own, that is a firm market heading into peak season. We think it understates what shippers will pay over the next ten weeks. Jet fuel has roughly doubled in a year, and rates have not caught up. Our view is that the gap gets closed through fuel surcharges, carrier by carrier, before the peak is over.

Where the market stands

Start with the volume. WorldACD says every main origin region grew in September. Asia Pacific and North America were each up 10% on the year. Middle East and South Asia (MESA) was up 9%. Europe and Africa, counted together, were up 8%. Central and South America was up 5%.
Rates rose faster than volume. Full-market rates (spot plus contract, averaged) were up 1% on August and 25% on the year. By origin, WorldACD has MESA up 52% year on year, Africa up 27%, Europe up 24%, Asia Pacific up 23%, North America up 18%, and Central and South America up 8%.
The latest week shows the same picture. In week 40 (28 September to 4 October), tonnage fell 2% on the week, mostly from Asia Pacific because of the Chinese and east Asian holidays. Spot rates still rose 1% and were 32% above the same week last year, WorldACD says.
The Baltic Air Freight Index tells the same story. TAC Index, which publishes it, says the global index (BAI00) rose 5.0% in the week to 5 October, as the market entered China’s Golden Week. That put it 25.5% above a year earlier. Frankfurt outbound was up 46.0% year on year. Chicago outbound was up 77.2%, though TAC notes that is against a weak base from last year. TAC also reports India spot rates close to 70% higher on the year to the US and more than 80% higher to Europe.
One caution on the trend. WorldACD’s third-quarter numbers show rates down 7% on the second quarter, even while they were up 24% on the year. WorldACD says rates were highly elevated in the second quarter, declined in June and July and stabilised in August. They are now firming again from a higher base.

Fuel is the cost that has not landed

Here is the core of our argument. TAC Index, citing IATA’s Jet Fuel Price Monitor with Platts data, says average jet fuel prices were “up by more than double the level of 12 months earlier at +108% YoY” by 2 October. IATA’s latest weekly fuel monitor puts the global average at $187.34 a barrel, up 1.0% on the week before.
Fuel is not a small line for an airline. TAC’s Neil Wilson puts it at “typically 25% to one-third of total costs depending on other factors”. He writes that rates “had not risen yet anything like so much as jet fuel prices”. TAC adds that carriers had secured fuel supplies further forward, but that there is a limit to how far forward this is possible.
Do the rough arithmetic. If fuel is a quarter to a third of costs and has doubled, an airline’s cost base is up something like a quarter to a third on that line alone. Rates are up about a quarter. On that rough maths, much of the 25% rise has already been absorbed by fuel, and there is little margin left if prices stay where they are. Wilson’s conclusion is that it “seemed more likely than not that this would put a hard floor under air freight rates”.
We agree, and we would go further. A hard floor is the minimum. The more likely path is a step up, delivered through the fuel surcharge (FSC). The FSC is a per-kilo charge airlines add on top of the base rate and adjust as fuel prices move. It is the fastest tool they have, because it can be changed every week or two without reopening contracts.

What happened last time fuel spiked

We have seen this movie this year. In March, as the conflict in the Gulf pushed oil higher, airlines did not move together. The Loadstar reported on 2 April that “Cargo fuel surcharges jumped sharply in late March as jet fuel prices spiked – but not all airlines followed.”
Using Hong Kong surcharge data, The Loadstar showed that Cathay Cargo raised its long-haul surcharge from HK$3.2/kgtoHK$12.9/kg from 20 March. Lufthansa Cargo, Japan Airlines and China Airlines changed little. “Within days, long-haul FSCs ranged from roughly HK$3/kgtonearlyHK$13/kg,” the report said. Cathay Cargo’s Dominic Perret told the outlet “our hedging covers only around 30% of the crude oil component”. Hedging means buying fuel at a fixed price in advance. With only about 30% covered, most of a price spike reaches the airline straight away.
Other airlines found different routes to the same place. Supply Chain Dive reported on 30 April that United Cargo brought in a “Market Disruption Fee” from 1 May, with the highest charge, 55 cents per kilo, on shipments from Asia Pacific. Air Canada Cargo added a new surcharge from 27 April.
Two lessons for this autumn. First, increases come fast once they come, within days rather than months. Second, they come unevenly. A forwarder quoting one blended “all-in” rate across carriers can be badly wrong on one airline and fine on another.

Not every lane is rising

The picture is not uniform, and forwarders should not quote as if it were.
The Freightos Air Index showed China to North America prices down 18% in the week to 6 October. Freightos wrote that “The Freightos Air Index shows Far East/China rates cooling more than 15% to N. America last week to $5.60/kg”. China to Northern Europe eased 7% to $3.83/kg. Freightos put both moves down to demand easing over Golden Week.
We read that as a holiday dip, not a turn. WorldACD’s September average for China to US spot was $6.05/kg, 30% above a year earlier, on tonnage up 17%. Demand on that lane is strong. Freightos also says data centre components are “a significant driver of global demand growth”, which is not holiday-sensitive cargo.
China to Europe is weaker for a structural reason. WorldACD says China and Hong Kong to Europe tonnage was down 10% on the year in September. That followed the EU’s removal of the de minimis exemption from 1 July (the rule that let low-value parcels enter duty-free). TAC adds that a €3-per-item interim duty came with it, and that customs data showed low-value declarations falling 53% while ordinary goods declarations more than doubled, a sign that sellers are bundling parcels. Even so, WorldACD has China to Europe rates at $4.53/kg in September, up 9% on the year and up from $4.26 in August.
Capacity in the Gulf is the other pressure point. WorldACD says Gulf-area capacity in week 40 was 17% below week 7, in late February, before the US-Iran conflict. The Loadstar reported on 9 October that after attacks on Riyadh airport, claimed by the Houthis, “Riyadh’s outbound capacity on freighters and widebody passenger aircraft fell 34% over 24 hours, to 848 tonnes”. Freighter-only inbound capacity fell 77% over the same 24 hours. Cathay Cargo’s Dominic Perret told the outlet: “We are anticipating a strong peak season”. He added that “one of our main challenges is having sufficient capacity to meet demand.”

What forwarders should do now

Put these together and the direction for the next ten weeks is clear to us. Demand is up. Capacity is tight on Middle East routings. Fuel costs have run ahead of rates. The cheapest way for airlines to close that gap is the surcharge.
For forwarders, that means a few practical things.
Keep peak quotes short. Validity of a week or two is safer than a month while surcharges are in play.
Quote the FSC as a separate line. Make clear to customers that it follows the airline’s published surcharge on the day of flight, not the day of quote.
Compare carriers on all-in cost, not base rate. March showed a fourfold spread in long-haul surcharges in one market. The cheapest base rate can be the most expensive airline once fuel is added.
Watch India and the Gulf. With MESA rates up 52% and Gulf capacity down 17%, shippers routing via Gulf hubs to Europe should book early and have a backup routing.
Do not read the China–US dip as a buying window that will last. If a customer has November volume ex-China, the post-holiday week is a reasonable time to lock space.
For shippers moving ocean-to-air at peak, we think the cost gap between the two modes is widening, not narrowing. That should push more planned cargo back to ocean where lead times allow.

Our call

Our prediction: before mid-November, at least two major cargo airlines will announce fuel surcharge increases on Asia long-haul routes. By the end of November, China to North America will be back above $6/kg on the Freightos Air Index, and the Baltic global index will stay more than 20% above last year through December. If jet fuel stays near today’s levels, we expect the surcharge, not the base rate, to account for most of the increase.

Sources