Shippers have increasingly been committing to longer-term fixed rate contracts in airfreight – but could struggle to retain those rates if the Red Sea disruption causes a spike in air capacity demand.

In the final quarter of 2023, contracts of more than six months’ length accounted for 45% of all agreements, up five percentage points from the third quarter, according to Xeneta data. Six-month contracts accounted for 28% of the market, while contracts of one month or less made up just 14%.

“This was in stark contrast to the pandemic era when most shippers had to manage rates valid for up-to-one-month only,” noted Xeneta.

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