‘How bad will it get?’ – Air cargo market awaits impact of tariffs and de minimis changes

1. Weak Growth in April Amid Economic Uncertainty

In April 2025, global air cargo volumes grew by +4% year-on-year, but the outlook remains bleak. The removal of the de minimis threshold for shipments from China to the US starting May 2 is expected to severely disrupt the e-commerce market in the coming weeks.

2. De Minimis Removal: A Game Changer

For the past 10 years, US consumers have paid no duties on imports under $800, resulting in 1.35 billion parcels annually entering the US. From May 2, however:

Low-value goods from China and Hong Kong are subject to 145% tariffs
If sent via postal services: 120% or a $100 flat fee, rising to $200 on June 1

About 50% of China–US air cargo is e-commerce, accounting for 6% of global air cargo volumes. The anticipated demand drop will likely disrupt airline capacity planning.

3. Initial Impact: Flight Cancellations and Rerouting

Several freighter services from China to the US have already been canceled or rerouted. Major Chinese e-commerce platform Temu has cut its advertising spending in the US.

Niall van de Wouw of Xeneta warned:

“This affects global supply chains, not just one industry.”

‘How bad will it get?’ – Air cargo market awaits impact of tariffs and de minimis changes

4. Freight Rates and Jet Fuel Prices Fell in April

Spot airfreight rates rose only +3% YoY, the second month of single-digit growth.
Jet fuel prices dropped -24% YoY, easing rate pressure.
Available capacity increased +3%; dynamic load factor fell to 57% (down 3 percentage points month-on-mon
5. Early April Tariff Actions Boosted Demand

The US’s “Liberation Day” tariff measures on April 2 triggered a rush in air cargo from Asia to North America:

Rates from Southeast Asia: up +13% MoM
Rates from Northeast Asia: up +10% MoM

But this spike began reversing in late April after the 90-day tariff pause and China’s 145% retaliatory tariffs.

6. Rate Trends by Region

North America → Northeast Asia: strongest rise at +14%
Middle East & Central Asia → Europe: flat MoM, but down -26% YoY
Transatlantic Westbound: fell -7% MoM due to summer bellyhold capacity and Easter slowdown
Northeast Asia → Europe (fronthaul): up slightly MoM, +10% YoY
Europe → Northeast Asia (backhaul): fell sharply, -17% YoY

7. “Waiting to See How Bad It Gets”

Van de Wouw noted that April’s data didn’t reflect full impact:

“Nothing’s changed yet – companies are in limbo. They’re trying to mitigate, but don’t know the outcome. The big question: what will 2025 bring?”

The true effect of the de minimis change will show in May’s data.

8. US Consumers Will Start to Notice

One clear example: a $19.49 power strip from Temu became $48.38 after shipping and taxes.

“The era of free shipping from China is over,” said van de Wouw.

9. 2025 Growth Forecasts Now Irrelevant

2025 was projected to grow 4–6% YoY, but now any forecast is meaningless due to extreme market uncertainty.

10. Will Tariffs Stick?

Lower airfreight rates may help shippers, but tariffs could still kill demand
If tariffs remain, volumes from China to the US will drop
Airlines will adjust their networks, potentially freeing up capacity for other regions

“This is likely the calm before the storm. If the new rules stay, global volumes will suffer – and traditional air cargo can’t fill the e-commerce gap.”