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How to Calculate Air Freight Costs

Air freight plays a crucial role in the global supply chain by enabling the rapid movement of products to distant destinations. Although it represents only a small part of the chain, its value is enormous. According to the International Air Transport Association, goods transported by air account for 35% of the economic value of world trade.

For companies, air freight offers speed, safety and efficiency. However, calculating the costs of this type of transportation is no easy task and requires an understanding of the key elements involved.

That is why, in this article, we will show step by step how to calculate air freight costs and the key aspects to consider.

Step 1: Determine the weight of the shipment

To calculate air freight costs, the weight of the shipment must first be determined. This weight is divided into two main categories: gross weight and volumetric weight.

Gross Weight

Refers to the total weight of the shipment, including packaging and protective materials used. It is important to know this exact weight, as it is often a determining factor in the shipping rate.

Volumetric Weight

This measure takes into account the size of the packages and the density of the products to calculate a theoretical weight based on the space occupied by the products in the aircraft. Often, airlines use volumetric weight to determine the cost of the shipment when space is a limiting factor on the cargo aircraft.

Step 2: Compare Gross Weight and Volumetric Weight

Once the gross weight and volumetric weight of the shipment have been determined, they are compared to establish which is greater. This comparison allows you to know what weight will be used as the basis for calculating the shipping cost.

Step 3: Calculate Shipping Cost

After establishing whether gross weight or volumetric weight is the predominant factor, the cost of the shipment is calculated. This calculation involves air freight rates, which may depend on several factors, such as airline, route, season and other relevant aspects.

  • If the gross weight is greater: In this case, the shipping cost will be based primarily on the gross weight of the shipment. Rates are usually set according to the actual weight of the cargo, with rates per kilogram or per pound, depending on the unit of measurement used by the airline.
  • If the volumetric weight is greater: If the volumetric weight of the shipment exceeds the gross weight, the cost of the shipment will be determined by the space occupied by the cargo on the aircraft.

This occurs because, although the cargo is light in actual weight, it takes up a lot of space in the cargo aircraft. Airlines use a standard formula to calculate volumetric weight, which usually includes dimensions such as the length, width and height of the package.

Additional Factors to Consider when calculating air freight costs

In addition to the aspects mentioned above, there are several additional factors that can influence air freight costs and should be taken into account when calculating the total cost of the shipment:

Routes and Destinations

Rates may vary depending on the specific route and final destination of the shipment. More popular and in-demand routes may have higher fares, while less frequent routes may offer more competitive fares.

Type of Merchandise

Some goods may have special restrictions or handling requirements that may affect the cost of air transportation. For example, hazardous or perishable products may require special handling and therefore generate additional costs.

Delivery Time

The urgency of the shipment may also influence costs. Shipments that require fast delivery, such as express or urgent shipments, may have higher rates compared to standard shipments.

Cargo Insurance

It is important to evaluate the convenience of taking out cargo insurance to protect the goods during transportation. The cost of insurance may depend on the declared value of the cargo and the level of coverage desired.

Handling and Storage Rates

Finally, in addition to air freight rates, there may be additional fees related to cargo handling and storage at origin and destination airports.

When is it not convenient to ship by air?

Shipping goods by air has some disadvantages that must be taken into account:

  • Price: shipping by air is much more expensive than shipping by ship. For example, a medium one-ton box from Shenzhen, China to Los Angeles, USA, may be worth 500 USD by ship, but can go up to 8,000 USD or more by air. Although this gap can vary depending on market fluctuations.
  • Pollution: according to a British government study, a 2-ton shipment over a 5,000-kilometer journey by ship emits 150 kg of CO₂, while by air it emits 6,605 kg of CO₂. Therefore, as we indicated in our article on sustainable air transport, the airplane is not the best alternative for the environment.
  • Weight: since the 1960s, cargo transportation has been based on shipping containers, which are perfect for shipping large and heavy objects. Airfreight shipping charges by size and weight, which can quickly increase the price.

If you would like more details or require additional advice, please do not hesitate to contact us. We will be happy to help you with whatever you need.

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