Air Cargo Rate Forecast for 2026: Preparing for a Softening Market

Overview: When Capacity Outpaces Demand

Recent forecasts suggest that 2026 will bring a more challenging environment for air cargo rates. Capacity expansion—particularly from bellyhold space as passenger traffic recovers—seems likely to exceed demand growth, putting downward pressure on yields and spot rates. Xeneta, for example, predicts a decline in airfreight rates in 2026 amid a capacity surplus (Air Cargo News).

This shift is already visible in 2025: IATA now expects global air cargo growth to slow to 0.7% year-over-year, with cargo yields declining around 5.2%. IATA Meanwhile, Xeneta reports that while e-commerce demand remains strong, rate growth has already begun to soften (Xeneta).

As the market softens, airlines, forwarders, and shippers need to reset expectations and strategies. Here’s what you should be watching — and doing — now.

What This Means for Airlines, Forwarders & Shippers

As capacity continues to outpace demand, rate pressure is expected to intensify, with excess space chasing limited cargo. Airlines may be forced to discount rates or offer incentives to fill loads, particularly on weaker lanes. This dynamic will drive greater volatility between spot and contract markets, as operators react to shifting supply–demand imbalances. While contract rates may decline, they will likely include more flexible indexing and performance clauses to manage uncertainty. In this environment, effective capacity management becomes critical — carriers that right-size their freighter and belly hold utilization to actual demand will be better positioned than those that overextend.

However, heightened competition and falling yields will lead to a margin squeeze, especially for operators with high fixed costs or less efficient structures. As a result, marginal lanes may become unsustainable, prompting reductions in service frequency or route withdrawals. Conversely, integrated logistics providers and forwarders—those managing both transportation and contractual logistics—will have an advantage, as their ability to optimize load factors, backhaul opportunities, and network routing enables them to absorb rate pressures more effectively and maintain profitability.

Tips for Locking in Favorable Contracts Now

• Negotiate longer-term contracts now while rates are still relatively firm, but include performance and index-based adjustment clauses to share downside risk.
• Use volume commitments or minimum guarantees to gain rate discount leverage, but balance that with exit or adjustment triggers.
• Structure flexible rate floors/caps or hybrid contracts combining fixed + variable components to hedge against volatility.
• Expand your lane portfolio strategically — add or retain high-margin lanes to balance weaker ones.
• Monitor cost drivers closely (fuel, surcharges, handling) and negotiate caps or sharing arrangements.
• Leverage partnerships and alliances to pool space and reduce per-unit cost risk.
• Invest in data analytics & forecasting to identify weak lanes early and redeploy capacity strategically.
• Account for inflation and currency risks when negotiating multi-year deals.

 

How AviaPro Supports Your Business Under Rate Pressure

At AviaPro, we combine analytical precision with industry expertise to help aviation stakeholders navigate shifting market conditions and protect profitability. Through rate and contract modeling, our team builds scenario-based models to stress-test pricing structures under declining rates, advising on the most effective use of floors, caps, and hybrid models. We complement this with network and capacity optimization, analyzing each client’s lane portfolio to identify opportunities for strategic reallocation and pairing that preserve margins even in volatile markets.

Our benchmarking and market intelligence services provide clients with the data-driven advantage they need—offering real-time rate benchmarks, competitive insights, and pressure indicators that strengthen negotiation positions. To further reduce exposure, our procurement and surcharge strategy support ensures that fuel, handling, and surcharge terms are structured intelligently within contracts, balancing flexibility and cost control.

Through risk and scenario planning, we conduct detailed sensitivity analyses to anticipate downturns and guide proactive decision-making, ensuring resilience under multiple market outcomes. Finally, our implementation and monitoring framework ensures strategies are executed effectively, compliance is maintained, and adjustments are made as conditions evolve—empowering our clients to stay agile, informed, and ahead of the market.

By engaging with AviaPro early, you can lock in smarter contracts, safeguard margins, and stay ahead in a softening market.