How Air Freight Costs Are Calculated

Air freight plays a vital role in global trade, accounting for 35% of trade value despite its higher cost compared to other modes. Understanding how air freight is calculated helps businesses better manage logistics and reduce expenses. One of the primary factors influencing air freight cost is the cargo’s weight and volume. Carriers charge based on actual or volumetric weight, whichever is higher, using a standard formula. Additionally, the nature of goods—like perishables or hazardous items—requires special handling, impacting costs. Distance between the origin and destination, along with the chosen flight route, also determines pricing. Direct flights tend to be cheaper, while congested hubs may add extra fees. Fuel prices, which make up a large portion of airline operating costs, fluctuate frequently and lead to fuel surcharges. Other cost factors include airport handling charges, customs and regulatory fees, seasonal demand surges, and currency exchange rates. By evaluating these elements, exporters and importers can optimize their air freight strategies, ensuring timely and budget-friendly deliveries.