BTX Blog

SUMMARY

The modes are moving in different directions this week. Air cargo is entering the holiday peak from a historically high rate base, with transpacific demand and jet fuel costs driving the market. Ocean rates on the transpacific are easing as U.S. import demand cools, while Asia–Europe holds steady. Shippers should be aware that conditions can shift quickly by lane and by mode.

Air cargo load factors are rising faster than capacity, ocean carriers continue to blank sailings, and North American truck posts are shrinking while loads climb. Space may be harder to find on short notice over the next several weeks, especially for time-sensitive freight around Thanksgiving.

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Air Freight: The Baltic Air Freight Index (BAI00) jumped 4.7% week over week in the seven days to October 19 and stands 26.4% above a year ago, already above the highs of the last two peak seasons. Jet fuel up more than 110% year over year is setting a high floor under air costs.

Ocean Freight: Drewry's World Container Index fell 3% to $4,429 per 40ft on October 29, ending a two-week climb as transpacific rates slipped. Shanghai–Los Angeles dropped 6% to $7,514 as U.S. import demand begins to ease.

Trucking: DAT spot linehaul rates firmed for the week ending October 31: dry van $2.23/mile, reefer $2.71, flatbed $2.61. Truck posts fell while load posts rose, pushing the flatbed load-to-truck ratio to 41.7.

Trade Compliance: Expanded 50% Section 338 duties on Canadian goods took effect October 30, adding about 100 HTS lines. The 178 Section 301 China exclusions are set to lapse after November 9 unless USTR extends them.

Commodities & Economy: Brent fell 7.6% to $104.77 on November 2 on U.S.–Iran peace-talk hopes, though it remains up about 71% year to date. The ISM Manufacturing PMI rose to 55.5 in October, while September payrolls grew just 29,000.

AIR FREIGHT INSIGHTS

The global Baltic Air Freight Index (BAI00), calculated by TAC Index, gained 4.7% week over week in the seven days to October 19, leaving it 26.4% higher year over year. TAC notes the index is already above the highest points of the 2024 and 2025 peak seasons. The gain followed a 2.1% Golden Week dip in the week to October 12, when the index stood at 2,552 points. A point value for the week to October 19, and the reading for the week to October 26: Data unavailable at time of publishing.

The surge was led by strong week-over-week increases on the busiest China–U.S. lanes, with smaller gains from China to Europe, where rates have lagged since the EU ended its old de minimis exemption in July. Spot rates out of Hong Kong and Shanghai were also rising. European outbound indices eased week over week but remain far above last year: Frankfurt (BAI20) fell 6.6% (up 33.7% YoY) and London Heathrow (BAI40) slipped 2.3% (up 35.2% YoY).

IATA's September data, released October 29, shows global demand up 7.7% year over year (international +8.6%) against capacity growth of only 2.7%. That lifted the global cargo load factor 2.2 points to 47.9%. North American carriers led all regions with demand up 11.8% on capacity up just 0.8%, and Asia–North America volumes rose 17%, the eighth straight month of growth, helped by AI-related shipments. When demand grows faster than capacity, a larger share of available space is filled, which tends to support carrier pricing; IATA reported yields rose 2% month over month in September.

Looking ahead, TAC says jet fuel, up 113.7% year over year, puts a hard floor under the rates at which airlines will carry cargo. Transpacific demand tied to data-center and semiconductor shipments remains the main growth engine, while Asia–Europe volumes are softer. Demand, capacity, fuel prices and Middle East developments will set the tone through the year-end peak.

Week to October 19, 2026. Source: TAC Index / Baltic Exchange via TIACA and Air Cargo News.

OCEAN FREIGHT INSIGHTS

Drewry's World Container Index (WCI) composite fell 3% to $4,429 per 40ft container on October 29, reversing a two-week upward trend. The decline was driven by the transpacific, while Asia–Europe held steady. A year-over-year comparison was not included in Drewry's latest release (Data unavailable at time of publishing).

Carriers continue to manage capacity actively. Drewry's Cancelled Sailings Tracker shows 56 blank sailings out of 715 scheduled on major East–West trades between week 45 (November 2–8) and week 49 (December 1–7). On the transpacific, six blank sailings are announced for next week, up from five; on Asia–Europe, blanks drop from eight to four, which means more effective capacity on that trade.

Demand signals are softening on U.S.-bound cargo. Drewry cites a National Retail Federation forecast that U.S. ocean import volumes will fall 11% month over month in November, and expects transpacific rates to decrease again next week while Asia–Europe rates remain stable. Congestion at Shanghai is easing, although Drewry flagged that Typhoon Champi could disrupt that improvement. Backhaul lanes also softened, with Rotterdam–New York down 2% to $3,106 and Los Angeles–Shanghai down 1% to $837.

On carrier and policy news, the suspension of U.S. Section 301 port fees on China-linked vessels is tied to the same November 9 deadline as the Section 301 product exclusions. The broader U.S.–China truce now runs to January 10, 2027, but trade advisers note the port-fee pause still requires a new USTR notice to carry forward.

Source: Drewry World Container Index, October 29, 2026.

NORTH AMERICAN TRUCKING

DAT national spot linehaul rates, which exclude fuel, firmed for the week ending October 31. Dry van averaged $2.23 per mile (up 3 cents), reefer $2.71 (up 3 cents) and flatbed $2.61 (up 1 cent). Year over year, dry van is up 32.6% and reefer 31.2%, and both sit well above their nine-year seasonal averages.

Load-to-truck ratios rose across all three equipment types as month-end freight met shrinking capacity. Dry van load posts rose 8.4% while truck posts fell 5.7%; flatbed truck posts fell 10.1%, pushing its ratio to 41.73, against 23.14 a year ago. A higher ratio means more loads are competing for each available truck, a sign of a tight market where carriers hold more pricing leverage.

Fuel remains a major cost driver. Diesel was recently reported near $6.35 per gallon, compared with $3.72 a year ago, which keeps fuel surcharges well above 2025 levels even when linehaul rates are flat. DAT's 35-day forecast projects dry van linehaul edging up to $2.26 per mile, reefer to $2.73 and flatbed holding near $2.60, pointing to a firm market heading into the Thanksgiving holiday.

National averages excluding fuel, week ending October 31, 2026. Source: DAT Freight & Analytics.

TRADE COMPLIANCE / US CUSTOMS UPDATES

Section 338 duties on Canadian goods expanded: A presidential proclamation signed October 23 modified the list of Canadian products subject to the 50% Section 338 duties, adding about 100 HTS classifications and removing 22, effective for goods entered on or after 12:01 a.m. ET on October 30. CBP issued filing guidance in CSMS #70314289 on October 29. The duties continue to apply regardless of USMCA eligibility and in addition to Section 232 duties. Cross-border shippers should confirm classifications against CBP's updated HTS list.

Section 301 China exclusions face November 9 deadline: The 178 Section 301 product exclusions, mostly machinery and manufacturing inputs, are set to expire at 11:59 p.m. ET on November 9. The U.S. and China extended their broader trade truce to January 10, 2027, but no extension of the exclusions had been published in the sources reviewed. Without one, affected goods entered from November 10 would again be subject to the Section 301 rate for their tariff line.

IEEPA refunds: CBP's CAPE Phase 3 opened October 6 for importers with finally liquidated entries covered by a court reliquidation order. As of October 2, CBP had accepted about $136.6 billion in potential and certified refunds and transmitted about $126 billion to the Treasury. On October 8, the Court of International Trade certified a class of importers that paid IEEPA duties, which may create a path for importers that did not file their own suits; no relief has been ordered yet. CBP's public comment period on its refund information collection closes November 4.

WORLD NEWS & COMMODITIES

Oil: Crude fell sharply to start November. On November 2, Brent settled at $104.77 per barrel (down 7.6%) and WTI at $96.46 (down 7.4%), WTI's biggest one-day loss since July, as hopes for renewed U.S.–Iran diplomacy eased Middle East supply concerns. Both edged up early Tuesday, with Brent near $105.55 and WTI near $97.25. Brent remains up about 71% year to date, and WTI is about 56% above a year ago.

Geopolitical shipping disruptions: The Middle East conflict and Strait of Hormuz risk remain the dominant factors for energy and transport markets, and the prospect of U.S.–Iran talks is the main reason prices eased this week. Jet fuel and diesel remain roughly double year-ago levels, and Typhoon Champi is a near-term weather risk for Shanghai port operations.

U.S. economic pulse: Nonfarm payrolls rose just 29,000 in September, well below forecasts near 90,000, and unemployment ticked up to 4.2%. The October jobs report is due Friday, November 6. Manufacturing is stronger: the ISM Manufacturing PMI rose to 55.5 in October from 54.5, its 10th straight month of expansion, with all five components above 50. Production reached 59.0, its highest since November 2021, while the Prices Index stayed elevated at 75.2 and supplier deliveries continued to slow.

US Economic Pulse — Most Recent Readings

Sources: U.S. Bureau of Labor Statistics via First Trust; Institute for Supply Management.

WHAT THIS MEANS FOR YOUR SUPPLY CHAIN

The modes are moving in different directions this week. Air cargo is entering the holiday peak from a historically high rate base, with transpacific demand and jet fuel costs driving the market. Ocean rates on the transpacific are easing as U.S. import demand cools, while Asia–Europe holds steady. Shippers should be aware that conditions can shift quickly by lane and by mode.

Capacity is the common thread. Air cargo load factors are rising faster than capacity, ocean carriers continue to blank sailings, and North American truck posts are shrinking while loads climb. Space may be harder to find on short notice over the next several weeks, especially for time-sensitive freight around Thanksgiving.

Fuel remains a major factor even after this week's drop in crude. Oil prices are highly sensitive to U.S.–Iran developments, and fuel surcharges across air, ocean and truck may move quickly in either direction as markets react.

For importers, the compliance calendar is busy. The expanded Section 338 list for Canadian goods is now in effect, the Section 301 China exclusions face a November 9 deadline, and IEEPA refund pathways continue to evolve. Reviewing classifications and duty exposure with your customs broker can help avoid surprises at entry.


The BTX team monitors these markets daily. If any of the trends in this report affect your specific lanes or commodities, reach out to your account manager or click here to learn more.