BEIJING: The recent attacks on vessels in the Red Sea, disrupting shipping through the Suez Canal, have prompted a notable increase in air cargo shipments from Asia to Europe. Companies that traditionally rely on shipping clothing exports from Vietnam to Europe are opting for the more expensive but expedited air freight alternative, according to freight platform Xeneta.
Cargo volumes from Vietnam to Europe experienced a remarkable 62% surge in the week ending January 14 compared to the previous week. Concurrently, rates increased by 10%, indicating a significant shift in logistics strategies.
Niall van de Wouw, Chief Air Freight Officer for Xeneta, highlighted that this surge is the first signal in their data indicating the impact of the Red Sea crisis on air freight. Notably, this surge occurred during a typically quieter time of the year for air freight.
Significance of Red Sea in Asia-Europe Trade
The Red Sea, a crucial part of the east-west trade route from Asia to Europe and the Americas, has seen increased security concerns due to recent attacks. About 12% of global shipping traffic accesses the Suez Canal through the Red Sea. With attacks by Yemen’s Houthi group on vessels, more manufacturers are turning to air freight as an alternative to avoid delays caused by disruptions to sea routes.
Logistics firms report a growing trend of securing additional air cargo space, and some customers are shifting towards shipping goods wholly or partially by air. The volume of air shipments on the Vietnam-Europe route in the week ending last Sunday was 6% higher than the peak week in October 2023 and 16% more than the same week a year ago. The coming weeks will reveal whether this trend represents a genuine and significant shift from ocean to air freight due to the ongoing Red Sea crisis, according to van de Wouw.
