Global freight market report – January 2025

The global freight market enters 2025 with a mix of challenges and opportunities across air, sea, and road transport.

While markets demonstrate resilience following pandemic-driven disruptions, they are adapting to shifting demand patterns, geopolitical uncertainties, and seasonal adjustments. This report examines key trends shaping the freight landscape, highlighting regional dynamics, pricing developments, and forward-looking insights.

AIR

The air cargo market displayed robust growth through much of 2024 but began moderating by year-end. While double-digit year-on-year (YoY) growth characterised early 2024, the fourth quarter witnessed single-digit increases, reflecting a stabilising trend.

Key drivers included strong demand from Asia-Pacific and the Middle East & South Asia (MESA) regions, despite regional variations.

Spot rates remained high into early 2025, with significant YoY increases, particularly out of Asia-Pacific and MESA. However, transatlantic westbound routes experienced sharper rate hikes in late 2024, driven by reduced belly-hold capacity and a redirection of freighter capacity to Asia. These rates eased slightly in December but remain elevated compared to the previous year.

Demand from Asia-Pacific, especially for exports, bolstered tonnages, though growth rates decelerated toward year-end. MESA followed a similar pattern, benefiting earlier in the year from disruptions in ocean freight through the Red Sea. While rates softened post-peak season, they remained significantly above typical low-season levels, supported by high e-commerce volumes and ongoing capacity imbalances.

The outlook for 2025 suggests a more stable air freight market. Key regions such as Asia-Pacific and MESA are expected to maintain strong demand, though growth will likely moderate further.

SEA

Ocean freight rates exhibited mixed trends in late 2024 and early 2025. Asia to US West Coast rates stabilised, while East Coast rates saw slight decreases. In contrast, routes to Europe and the Mediterranean experienced modest increases, driven by pre-Lunar New Year demand.

A tentative ceasefire in the Red Sea region may alleviate disruptions to shipping lanes, although carriers remain cautious. The resumption of traffic in the area depends on sustained peace agreements, which currently appear to be fragile. Meanwhile, the resolution of labour disputes at US East Coast ports has brought operational stability – at least for now – although elevated rates earlier in the season have since normalised.

Transpacific rates surged in early January due to Lunar New Year-driven demand, increasing over 50% for West Coast routes and 30% for East Coast routes compared to late December. However, rates are expected to stabilise post-Lunar New Year. Asia-Europe lanes have seen rates plateau following significant spikes caused by Red Sea diversions, with reductions anticipated as demand normalises.

While the Drewry WCI composite index rose 2% recently, it remains well below pandemic peaks. Rates on major lanes showed mixed movements, with notable increases on transpacific routes but slight decreases on some Asia-Europe lanes. Future rate adjustments will depend on geopolitical developments and regional trade policies.

ROAD

European road freight markets face a modest recovery in 2025 following a period of stagnation. Economic constraints, particularly in Germany, coupled with geopolitical uncertainty, have suppressed growth. Nonetheless, the sector is projected to grow by 2%, with cross-border trade expected to expand slightly faster at 2.4%.

Economic growth forecasts for the eurozone have been revised downward, with GDP expected to increase by 1.1% in 2025. Inflation is projected to stabilise near 2%, though consumer confidence remains subdued. Shippers have adapted by reducing excess inventory, which has curbed road freight demand. However, this phase appears to be concluding, setting the stage for a gradual recovery.

Road freight activity is expected to rise as economic conditions improve, though driver shortages, cost control and green initiatives remain critical priorities.

WAREHOUSE

The UK warehouse market in Q4 2024 experienced a decline in demand for new space, although key sectors like manufacturing, retail, and 3PLs continued to show resilience. Demand for ESG-compliant facilities remained strong, despite overall logistics demand falling to 6.2 million sq ft in Q3.

Rental growth slowed, averaging 6.8% for standard industrial and 5.1% for distribution warehouses, driven down by rising operational costs. London outperformed, with higher growth driven by demand for smaller units in premium locations.

Investment volumes remained subdued at ￡1.4 billion in Q3, lagging 13% behind 2023 levels. The development pipeline also contracted, with new starts falling to 2.2 million sq ft. Meanwhile, the supply of second-hand space increased for the first time since 2017, reflecting shifting market dynamics.

The market continues to navigate a challenging landscape, balancing evolving demand and economic pressures.

LOGISTICS

The United Kingdom Contract Logistics Market size is estimated at USD 102.69 billion in 2025, and is expected to reach USD 120.27 billion by 2030, at a CAGR of 3.21% during the forecast period (2025-2030).

The United Kingdom’s contract logistics market landscape is experiencing significant transformation driven by evolving supply chain dynamics and technological advancements. Around 89% of all goods transported by land in Great Britain are moved directly by road, highlighting the critical importance of efficient road transportation infrastructure in the country’s logistics industry.

The eCommerce sector continues to be a major catalyst for innovation in logistics services, with consumer eCommerce now accounting for over 36% of the total retail market in the United Kingdom. This shift has prompted the logistics sector to expand warehousing capacity significantly, with the sector acquiring approximately 13.6 million square feet of warehouse space, representing 22% of total commercial property acquisitions.

Across Asia, the UK, and Europe, our teams are closely monitoring developments across supply chain, logistics and warehouse markets. We proactively adapt our strategies to navigate shifting conditions, mitigate challenges, and maintain resilience in our customers’ supply chains. Our commitment to providing timely insights ensures you stay informed and prepared to optimise your logistics operations.

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