Air freight has carved out a significant presence as a vital method of transportation in the supply chain and logistics industry. Over the past few years, congested ports and long delays for cargo movement helped illustrate the importance of more speedy options for shipping – the thing air freight is known for. So, what can we expect for this crucial method of shipping in 2023? We’ve got our air freight trends to look for in 2023 so you can best prepare your supply chain now.
Outside World Influences
Air freight cargo has faced many challenges over the past few years as external forces have applied consistent pressures. Sanctions and airspace closures following the Russian invasion of Ukraine forced significant rerouting and the surge in crude oil prices directly affected the industry itself and customers.
While the war in Ukraine will likely continue to create uncertainty, energy and oil prices are expected to drop by mid-year. This will have a resoundingly positive impact on businesses facing high fuel costs. This should help ease a lot of the tension with tightening cost of living expenses that many people have had to face with the rising costs of goods around the world and give businesses some relief when using air freight.
Air Capacity Increasing
Prices for air travel are expected to gradually start leveling off. The aviation industry faced sky high rates and limited capacity for quite a while in the pandemic years. So as the industry continues to open up in 2023 and increase the numbers of air cargo customers, air freight will likely begin its return as a preferred method of goods transportation.
There’s likely to be an overall market shift as a result of increasing capacity, which drives the supply and demand ratio down. This will help establish a more balanced supply and demand picture. And many carriers have plans to add to their air cargo fleet over the coming years, increasing viability and capacity for this mode of transportation.
Rates Stabilize & Traditional Sectors Grow
The more traditional air freight commodities like electronics and pharmaceuticals will continue to keep the air freight industry moving. These popular items rely on modes of transportation that keep them moving fast. And as inventory levels out more this year, the volume of shipments will continue to rise.
This will also help rates stabilize, especially as cargo planes transition back to being used as passenger planes. We’re seeing the undoing of the pandemic response that turned passenger planes into cargo planes to ensure enough capacity for the fastest moving mode of transportation. As this move is undone, the market will continue to right itself and stabilize rates.
Diversifying Lead Times
As air freight continues to prove itself as a viable option once again, a clear need for diversifying lead times will help shape the air freight cargo offering. Giving shippers the option of combining air freight, sea freight and rail freight provides a more strategic approach for 2023.
Utilizing the time involved with each mode of transportation will help diversify the lead times for products and their necessary movements. This also allows for a lot more creativity in designing how supply chains are structured, when deliveries can take place, and provides more options for different price points.
Final Thought
As the last few years have made very clear, air freight and logistics businesses should always be planning and preparing for any challenge and benefits that may lie ahead. It’s one of the things we love so much about air freight – the ability to use it for its speed alone as well as the opportunity to truly strategize for optimized logistics. If that sounds good to you, let’s talk about how you’ve been using air freight in your logistics or how you wish you could. We’re available 24/7/365 to answer your questions and keep your freight moving. Reach us anytime at sales@prdlax.com or 800-796-5031.
