IATA: Airfreight volumes and capacity increase MoM in June

While industrywide cargo traffic in cargo tonne kilometers (CTKs) decreased 6.4% year over year in June, it showed a slight 0.7% month-over-month improvement compared with May’s 8.7% decline . Capacity, measured in available cargo tonne kilometers (ACTKs), also returned with summer flight schedules. Capacity increased across all regions, growing 6.7% YoY in total and 9.4% YoY for international flights, according to a Tuesday report from the International Air Transport Association (IATA). In turn, industrywide cargo load factors were down 6.9 percentage points YoY to 41.9% in June due to capacity surpassing demand. During the first half of 2022, capacity grew 4.5% YoY in total and 5.7% YoY for international operations. Supply chain constraints resulting from the war in Ukraine and COVID-19-related lockdowns in China have affected overall freight movement , but air cargo continues to show a “strong performance,” according to the report. “Current economic uncertainties have had little impact on demand for air cargo, but developments will need to be closely monitored in the second half [of the year],” IATA Director General Willie Walsh said in the release. Manufacturing decline, inflation increase New export orders declined in H1 — with the exception of China — according to the Manufacturing Purchasing Managers’ Index (PMI), and new export orders fell below 50, indicating a contraction in manufacturing activity. IATA further noted the decline in both the U.S. and Germany was especially significant. “The historical relationship between the global PMI for new export orders and industrywide CTKs suggest that weak YoY CTK outcomes may persist in the near term,” IATA reported. YoY inflation is also on the rise, as measured by the Consumer Price Index (CPI), which was at 7.5% in June, according to IATA. Inflation rose to 8.6% in the U.S., which was the highest reported rate among Organization for Economic Cooperation and Development (OECD) countries. In turn, household disposable incomes will be impacted by the higher consumer prices and interest rates, which “could impact air cargo demand in the period ahead,” IATA reported. Asia-Pacific Asia-Pacific airfreight volumes improved in June, due to the easing of COVID-19-related restrictions, which were lifted at the beginning of the month, IATA reported. International CTKs for Asia-Pacific carriers were down 0.7% YoY, while total market CTKs were down 2.1% YoY. IATA further noted that most of Asia Pacific’s main air cargo markets showed improvement, excluding North America. Asia-Pacific capacity showed a YoY improvement of 6.2% in June. Latin America Airlines based in Latin America continued to see a strong performance in June — as with May and April — with international CTKs increasing 23.5% YoY. Total CTKs were also up 19.6% YoY. IATA attributed the positive growth to many factors, including loosening COVID-19 restrictions and the role of air cargo in the region’s economic activity. Capacity growth in Latin America was also higher than any other region, a staggering 29.5% YoY jump. North America For carriers based in North America, international and total CTKs were down 8.7% and 6.3% YoY, respectively. Despite these slightly depressed numbers, the “lifting of restrictions in China may provide a boost to North American air cargo volume outcomes in coming months,” IATA reported. North American capacity increased 5.6% YoY. Europe, Middle East, Africa Europe showed the weakest regional performance, with total and international CTKs decreasing 13.5% and 13.4% YoY, respectively, IATA reported, primarily due to the war in Ukraine. European capacity increased 5.6% YoY. Carriers based in Africa reported international and total CTKs nearly flat at 5.8% and 5.7% YoY, respectively. IATA attributed the increase to European and Asian routes, which showed growth rates of 6.2% and 5.3%, respectively. African carriers saw a 10.3% YoY increase in capacity in June. Middle Eastern airlines also reported declines in airfreight volumes, with international and total CTKs down 10.8% YoY, despite cargo volumes to and from Asia showing improvement in recent months . Volumes to and from Europe, on the other hand, continue to trend sideways, as with the rest of 2022. Capacity in the Middle East increased 6.7% YoY.

IATA: Airfreight volumes and capacity increase MoM in June

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