Air cargo demand rises for third straight month

Global airfreight demand rose for the third consecutive month in October. Global demand, measured in cargo tonne kilometers (CTK), increased by 3.8% YoY in October, while demand for international operations rose 3.5% YoY, according to October data released by IATA . Global capacity, measured in available CTKs, rose 13.1% YoY and capacity for international operations rose 11.1% YoY. IATA attributes this capacity growth to the continued recovery of passenger travel, which increases belly capacity . International belly capacity, for example, rose 30.5% YoY on the strength of passenger markets, according to IATA. October’s increased YoY demand “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,” IATA Director General Willie Walsh said in a release. “Recovering demand, slightly stronger yields and the uptick in trade are all good news. But with demand still 2.4% below pre-pandemic levels and much uncertainty remaining over the trajectory of the global economy, optimism must be balanced with caution.” IATA noted that economic activity slowed in October, with the Purchasing Managers’ Index (PMI) for manufacturing output and export orders for major economies, excluding the United States, remaining below the critical 50 mark; the PMI figures landed between 45 and 49. “There is a clear marker for economic challenges ahead,” IATA stated in its report. Inflation continued to ease from its peak in terms of the Consumer Price Index (CPI), reaching between 3% and 4% for the United States and European Union, respectively, according to IATA. “China’s CPI, however, indicated deflation for the second time this year, raising concerns of an economic slowdown,” IATA stated. Walsh concluded, “A continued strong peak yearend season will certainly help the sector to manage through whatever turns the global economy might take in 2024.” [caption id="attachment_57139445" align="alignnone" width="1024"] (Courtesy/IATA)[/caption] Asia Pacific Asia-Pacific airlines saw air cargo volumes increase 7.6% YoY, similar to September’s growth of 7.7% YoY. Carriers in the region benefited from ongoing growth in CTKs on three major trade lanes: Africa-Asia, where CTKs grew 16.7% YoY, the greatest annual growth since May; Middle East-Asia, where CTKs grew 10.3% YoY; and Europe-Asia, where CTKs grew 8.5% YoY. Available capacity increased by 30% YoY as more belly capacity became available. Last year, several key markets in Asia were still under pandemic travel restrictions. North America North American carriers saw the weakest performance in October with a 1.8% YoY decrease in cargo volumes, a slight improvement from September, when volumes fell 2.2% YoY. Capacity rose 2.4% YoY. IATA noted that, despite improvements in volume along certain trade lanes, the region did not benefit significantly. The North America-Asia trade lane’s volume improved from a 1.8% YoY decline in September to a 0.9% YoY decline in October. Meanwhile, the North America-Europe market’s volume improved from a 2.7% YoY decline in September to a 2.1% YoY decline in October. Europe Air cargo volumes in Europe increased by 1% YoY, an improvement from September, when volumes fell 1.5% YoY. European carriers benefited from the first growth in international CTKs in the within-Europe market since January 2022; international CTKs rose 3.4% YoY. The region also benefited from 17.1% YoY growth in the Middle East-Europe trade lane, IATA stated. Capacity in Europe rose 7% YoY. Middle East The Middle East recorded a 10.9% YoY increase in cargo volumes, improving from September’s increase of 2.5% YoY. Capacity increased 15% YoY. Carriers in the region mainly benefited from volume growth in two markets: Middle East-Asia, which grew 10.3% YoY; and Middle East-Europe, which grew 17.1% YoY. Latin America Latin American carriers saw a 4% YoY increase in cargo volumes, an improvement from September’s growth of 2.3% YoY. Capacity grew 8.3% YoY. Africa African carriers saw volumes increase 2.9% YoY, an improvement from September’s decline of 0.1% YoY. Carriers in the region benefited from the strongest annual growth since May at 16.7%, according to IATA. Capacity rose 9.8% YoY.

Air cargo demand rises for third straight month

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