Air cargo demand from Asia to North America declined 10.7 percent annually in May in the month following the U.S. closure of the de minimis trade exemption for goods imported from China.
Despite the double-digit collapse on the all-important trade lane, which carries the largest market share in the industry at 24.4 percent of cargo-tonne kilometers (CTKs), overall air cargo demand worldwide increased 2.2 percent during the month.
Willie Walsh, director general of the International Air Transport Association (IATA), which released the data on Monday, called the global demand growth “encouraging news.”
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“A 10.7 percent drop in traffic on the Asia-to-North America trade lane illustrated the dampening effect of shifting U.S. trade policies,” said Walsh in a statement. “Even as these policies evolve, already we can see the air cargo sector’s well-tested resilience helping shippers to accommodate supply chain needs to flexibly hold back, re-route or accelerate deliveries.”
Although seasonally adjusted month-over-month data saw global air cargo demand contract by 1 percent, IATA called May’s weakening numbers “less dramatic than feared by many.”
Capacity, measured in available cargo tonne-kilometers (ACTK), increased by 2 percent from the year-ago month, with Asia-Pacific based airlines seeing a capacity increase of 5.7 percent. According to the industry body, belly-hold cargo capacity gained 5.8 percent year-over-year and 5.5 percent month-over-month in May 2025, marking the highest jump since 2019.
IATA already lowered its 2025 air cargo demand forecast at the start of June amid the projected impacts of the de minimis suspension, as well as the tariffs the Trump administration placed on U.S. trade partners.
Total demand is projected to increase only 0.7 percent this year to 275.7 billion CTKs, down from the initially estimated 6 percent CTK growth in December.
A monthly freight report from international freight forwarder Dimerco Express Group released Sunday indicated that air freight demand from China to the U.S. and E.U. remains weak, with “no signs of recovery” in e-commerce volumes. As a result, scheduled freighter flights continue to be cancelled.
China-U.S. cargo volumes have declined by as much as 60 percent, the report said, with e-commerce bookings down approximately 50 percent in May and June since de minimis was halted.
FedEx recently backed this data, saying that China-to-U.S. volumes “deteriorated sharply” in early May, resulting in flat international export revenue for the fourth quarter.
Rates out of China have still been falling as the demand declines persist, with weekly China-to-North America weekly prices falling 2 percent to $5.18 per kilogram, according to a July 24 update from Freightos.
While the IATA indicated the practice of front-loading cargo into the U.S. via air had likely run its course ahead of the July 9 tariff deadline for most country-specific tariffs, the Dimerco report said that demand out of Southeast Asia—particularly from Thailand and Vietnam—is starting to pick up due to the upcoming deadline.
Unlike all regions of China and Hong Kong, in which U.S.-bound cargo demand is categorized as “soft,” the Southeast Asian markets are expected to see an upturn in demand, or already have tight space.
Air freight capacity and rates remain stable out of Vietnam, according to Dimerco, but freight rates may rise in early July as the tariff deadline approaches. For Thailand, the freight forwarder recommends importers to book cargo to the U.S. and Canada one week ahead, as current rates are high.
India’s air freight rates are expected to increase as well as disruptions to global shipping routes are posing challenges for the country’s export sector. According to the Dimerco report, tensions in the Middle East may affect capacity and rates for shipments between the E.U., the U.S. and the Indian subcontinent.
As June marks the end of the quarter, air freight backlogs out of Singapore are expected to build in July, driven by increased manufacturing activity in electronics and garments.
Although rates could see an increase out of southeast Asia in July, it will come after a global cooling down period in part because of the de minimis suspension.
According to IATA, cargo freight rates across all trade lanes declined for the first time in 2025 in May, by 2.9 percent year over year and 3.7 percent month over month.
More recent data indicates that rates are still down from 2024 levels worldwide. According to WorldACD, which analyzes more than 500,000 transactions per week, rates were $2.43 per kilogram for the week of June 16-22, down 1.2 percent from the year-ago period, but up 1.7 percent from the $2.39 per kilogram the week prior.
