Air Cargo Management

Air cargo demand up 3.8% in October, reports IATA

air cargo
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Global air cargo markets data for October 2023 released by the International Air Transport Association (IATA) indicates the third consecutive month of stronger year-on-year demand.

Willie Walsh, IATA’s director general, said: “Demand for air cargo was up 3.8 per cent in October. That marks three consecutive months of year-on-year growth, placing air cargo on course to end 2023 on a much stronger footing than it began the year.”

The IATA data shows that global demand, measured in cargo tonne-kilometres (CTKs), increased by 3.8 per cent compared to October 2022. For international operations, the demand lagged slightly at 3.5 per cent.

Capacity, measured in available cargo tonne-kilometres (ACTKs), was up 13.1 per cent compared to October 2022 (11.1 per cent for international operations). IATA states this was largely related to the growth in belly capacity. International belly capacity, for example, rose 30.5 per cent year-on-year on the strength of passenger markets.

IATA reports there are several factors influencing the operating environment.

For instance, global trade reversed its downward trajectory and stabilised in September. Although below its 2022 peak, global cross-border trade is more than five per cent above pre-pandemic levels.

Furthermore, after a continuous 17-month decline, cargo yields ticked-up in September and continued into October with a 2.6 per cent month-on-month gain, remaining well-above pre-pandemic levels.

Walsh added: “Recovering demand, slightly stronger yields and the uptick in trade are all good news. But with demand still 2.4 per cent below pre-pandemic levels, and much uncertainty remaining over the trajectory of the global economy, optimism must be balanced with caution.

“Nonetheless, a continued strong peak year-end season will certainly help the sector to manage through whatever turns the global economy might take in 2024.”

Regional performance

When looking at regional performance for the period, Middle Eastern carriers had the strongest performance in October 2023, with a 10.9 per cent year-on-year increase in cargo volumes. This was a significant improvement from the previous month’s performance (+2.5 per cent). Carriers in the region benefited from growth in the Middle East–Asia (+10.3 per cent) and Middle East–Europe markets (+17.1 per cent). Capacity increased 15 per cent compared to October 2022.

North American carriers had the weakest performance in October with a 1.8 per cent decrease (YoY) in cargo volumes. This was a slight improvement in performance compared to September (-2.2 per cent). Although the North America-Asia trade lane recorded an increase in international CTK’s (from -1.8 per cent in September to -0.9 per cent in October) and the North America-Europe market saw a slight improvement in international CTK’s (from -2.7 per cent in September to -2.1 per cent in October), carriers in the region did not benefit significantly. Capacity increased by 2.4 per cent compared to October 2022.

European carriers saw their air cargo volumes increase by 1.0 per cent in October compared to the same month in 2022. This was a stronger performance than in September (-1.5 per cent). Carriers in the region benefitted from the first growth in international CTK’s in the within Europe market since January 2022 (-4.2 per cent in September vs +3.4 per cent in October). Gains made from the expansion in the Middle East-Europe trade lane (+17.1 per cent in October) also benefited carriers in the region. Capacity increased 7.0 per cent in October 2023 compared to 2022.

Asia-Pacific airlines saw their air cargo volumes increase by 7.6 per cent in October 2023 compared to the same month in 2022. This performance was close to par with the previous month (+7.7 per cent). Carriers in the region benefited from ongoing growth in international CTK’s on three major trade lanes: Africa-Asia (+16.7 per cent, the greatest annual growth since May), Middle East-Asia (+10.3 per cent) and Europe-Asia (+8.5 per cent). Available capacity for the region’s airlines increased by 30.0 per cent compared to October 2022 as more belly capacity came online from the passenger side of the business (a year ago, the key Asian markets of Japan and China were still largely under severe Covid-19 travel restrictions).

Latin American carriers experienced a 4.0 per cent increase in cargo volumes compared to October 2022, a notable increase compared to the previous month’s gain (+2.3 per cent). Capacity in October was up 8.3 per cent compared to the same month in 2022.

African airlines saw their air cargo volumes increase by 2.9 per cent in October 2023, much improved compared to September’s performance (-0.1 per cent). Carriers in the region benefitted from the strongest annual growth since May (+16.7 per cent). Capacity was 9.8 per cent above October 2022 levels.

The full ‘Air Cargo Market Analysis’ for October 2023 can be found on the IATA website.

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