Global Freight Market Report - April 2025

While March brought an uptick in global output, confidence across key supply chain sectors remains fragile, particularly as the U.S. implements—and partially suspends—new tariffs targeting Chinese imports.

Forecasts for global GDP growth have been revised downward to 2.5%—the weakest projection since 2009—with North America facing the sharpest reductions. Although capacity is expanding across several transport modes, demand remains uneven, resulting in short-term market volatility and pressure on margins.

Upcoming changes to U.S. De Minimis rules, the continuing fallout from Red Sea disruptions, and evolving alliance structures are all creating a fluid operating environment.

Air Freight

The air cargo market is currently divided between strong Asia–Europe performance and volatility on transpacific lanes, driven by front-loading, tariff uncertainty, and shifting trade dynamics. Worldwide tonnage rose by +6% year-on-year (YoY) in April, with a +10% YoY surge from Asia Pacific, as US importers moved early to beat the 2 May end of ‘de minimis’ exemptions on low-value eCommerce shipments from China.

All major origin regions recorded YoY growth except Middle East & South Asia (MESA), which remained flat. This lifted cumulative global volumes for the first four months of 2025 to +3% YoY. However, China and Hong Kong to the US have seen four consecutive weeks of volume declines, now -16% YoY, highlighting the transpacific fragility. While Vietnam, Taiwan, and Thailand posted modest gains, they haven’t offset the broader downturn.

Meanwhile, Asia–Europe flows remain robust, supported by double-digit YoY volume growth, load factors above 90%, and stable spot rates near $4/kg. Global average rates in April held steady at $2.43/kg, but Asia–US rates softened by 8%, with markets like Vietnam down 28%, as pre-de minimis pre-loading tapered off and rates adjusted.

Looking ahead, the end of de minimis exemptions is expected to trigger a significant short-term drop in US-bound demand from China, leading to possible freighter redeployments and renewed rate and capacity volatility. Carriers are cautiously adding capacity, but geopolitical tensions and tariff uncertainty continue to influence short-term planning strategies.

- Asia–Europe volumes grew double digits YoY in March, with load factors exceeding 90%, indicating strong demand and utilisation.
- Transpacific volumes from China and Hong Kong to the US are down 16% YoY, despite gains from Southeast Asia.
- Air freight rates from Asia to the US dropped 8%, including a 28% fall from Vietnam as front-loading eased.
- Baltic Air Index shows global rates up 2% YoY, with Asia–Europe rates up 13%, but summer schedules and de minimis changes pose new risks.

Ocean freight

Markets remain delicately balanced as carriers navigate excess post-Chinese New Year capacity and volatile demand, particularly on transpacific routes. On the Asia–Europe corridor, a significant year-on-year (YoY) capacity surge has begun to soften spot rates, even as utilisation stays high. At the same time, ongoing Red Sea diversions continue to absorb global tonnage and contribute to network reliability challenges.

In response to weaker U.S.-bound demand from China, carriers are increasingly blanking sailings and restructuring services, with Southeast Asia expected to fill some of the gap during the current U.S. tariff pause. While alliances such as Gemini are offering improved schedule reliability, oversupply and geopolitical headwinds are likely to cloud the outlook through Q2.

Blank sailings data underlines the shift. Between 7 April and 12 May, Asia–North America East Coast services were largely uninterrupted—until a sudden spike in blank sailings for the week starting 5 May. By 8 April, 35% of planned capacity for that week had been blanked, rising to 42% by 15 April. On West Coast services, the trend began earlier: 13% of sailings for the week starting 28 April had been cancelled by 8 April, jumping to 28% a week later.

With 81 transpacific sailings blanked in April alone and the 9 July tariff deadline approaching, rate volatility is expected to persist. Meanwhile, capacity to Europe remains relatively stable, but spot rate stability will hinge on demand holding up into the peak season.

- Asia–Europe capacity surged +27% YoY, placing downward pressure on spot rates despite high load factors.
- The Gemini alliance reports 94% origin reliability, with broader impacts expected mid-year.
- Red Sea diversions continue to absorb 10–12% of global capacity, straining reliability.
- Drewry’s WCI rose +2% in April, though it remains 79% below pandemic highs.

Road Freight

Road freight in the UK and Europe showed resilience in March, supported by improved availability and a late Easter peak. Strong articulated capacity helped balance increased demand, offering buyers a brief cost advantage.

- TEG Road Transport Index rose to 119.9
- Articulated demand up 37% MoM; capacity up 31% YoY
- Fuel prices fell over 1% MoM, easing operating costs
- Courier sector remains flat YoY, reflecting cautious B2C activity

As volumes pick up into April and May, particularly in retail and food sectors, upward pricing pressure is expected. Labour cost inflation and minimum wage rises will continue to affect haulage and courier providers alike.

Contract Logistics

The contract logistics sector enters Q2 with long-term growth signals, bolstered by major government investment in infrastructure and skills. However, operators still face short-term cost and regulatory challenges.

- £625m Spring Statement workforce package
- £4.8bn committed to Strategic Road Network upgrades
- Labour and vehicle cost inflation remain key concerns
- Clarity awaited on EV policy and van taxation

Demand continues to rise in last-mile, automated fulfilment, and omnichannel segments. With the June Infrastructure Strategy pending, providers are positioning for growth in digital and sustainable logistics zones.

Warehousing

The UK warehousing market remains robust, led by demand for Grade-A space and strong investor confidence. Rents and capital values continued to grow in March, reflecting long-term structural resilience.

- Capital values +0.4% in March; rental values +0.3%
- 2025 take-up forecast: 40 million sq ft
- Overseas investment to comprise 60% of 2025 deals
- Speculative development low, supporting supply balance

Occupiers are prioritising high-spec assets with ESG and automation capabilities. As demand stays firm and inflation stabilises, warehousing looks set to deliver consistent returns through 2025.

While economic uncertainty and evolving trade barriers continue to reshape global shipping, Logicall remains committed to helping our clients enhance supply chain efficiency and resilience, all while ensuring full compliance with regulatory changes.

Our proactive approach and timely market insights ensure you stay informed, agile, and ready to optimise your logistics strategy.

For personalised support or to discuss any of the issues highlighted in this report, please contact us today.