IATA: Cargo traffic declines while capacity increases in July

Global cargo demand is approaching pre-pandemic levels, although it remains lower than the unusually high levels of 2020-2021. Industrywide cargo traffic, measured in cargo tonne kilometers (CTKs), fell 9.7% year over year in July and dropped 10.2% YoY for international operations. The decrease in traffic was 3.3 percentage points lower compared with June’s 6.4% drop , and 3.5% lower than the pre-pandemic level of June 2019, according to a Sept. 7 report from the International Air Transport Association (IATA). Meanwhile, cargo capacity, measured in available cargo tonne kilometers (ACTKs), continued a rebound that came with increased summer flight schedules. Capacity rose 3.6% YoY and 6.8% YoY for international operations, but remained 7.8% below July 2021 levels, according to the report. In turn, industrywide cargo load factors were down 6.9 percentage points YoY to 47.2% in July as capacity continued to surpass airfreight demand. The war in Ukraine continues to dampen capacity , despite a recent boost amid an absence of Russian and Ukrainian stakeholders, causing supply chain constraints. However, the gradual easing of COVID-19 lockdowns in China means airfreight should see continued recovery throughout the year, the report stated. New export orders, which indicate cargo demand, decreased in all markets in H1 except China, which increased orders in June . New export orders fell below 50 in June , indicating a contraction in manufacturing activity. “Volatility resulting from supply chain constraints and evolving economic conditions has seen cargo markets essentially move sideways since April,” IATA Director General Willie Walsh said in the release. “July data shows us that air cargo continues to hold its own, but as is the case for almost all industries, we’ll need to carefully watch both economic and political developments over the coming months.” Asia-Pacific Carriers in the Asia-Pacific region saw international CTKs fall 9.3% YoY and total CTKs fall 9% YoY, a much larger decline than the 2.1% decrease in June, IATA reported. The drop in volumes, driven primarily by COVID-19 restrictions, labor shortages and the war in Ukraine, indicate increased volatility. Available capacity increased by 2.7% YoY, a slightly smaller increase from the 6.2% YoY bump in June. Latin America Latin America was the only region to report increased CTKs, with carriers seeing a 10.5% YoY rise in international CTKs and a 9.2% YoY climb in total CTKs. Performance in June was even stronger, with CTKs increasing 23.5% YoY. IATA attributed the positive results to carriers introducing new services and capacity. Growing capacity in Latin America also outperformed every region, reporting a 21.4% YoY jump. North America International and total CTKs fell 5.7% for North American carriers, an improvement from the 13.5% decline in June. IATA expects the lifted restrictions in China to help demand rebound in the coming months, the report noted. Meanwhile, capacity increased by 4.2% YoY. Europe, Middle East, Africa European carriers saw the largest decrease in volumes for a third consecutive month, with international and total CTKs falling 17% YoY. The war in Ukraine continues to lower demand, spurring poor performance in Europe each month since February, when the war began. Capacity showed a small improvement, increasing by 0.9% YoY. International CTKs for Middle Eastern carriers decreased 10.8% YoY and total CTKs decreased 10.9% YoY, also as a result of the war in Ukraine. New routes were expected — but never opened — for carriers to avoid flying over Russian airspace, keeping demand low. Capacity improved moderately with a 4.9% YoY increase. African carriers saw a 3.5% decrease YoY in international and total CTKs, while they were nearly flat in June with 5.8% YoY growth. Africa was also the only region to see lower capacity, with a decline of 2.2% YoY. Join Air Cargo World for our next webinar, “Forward Thinking: Best practices for freight forwarder success,” on Tuesday, Sept. 13, at 11 a.m. ET. Click here for more information and to register.

IATA: Cargo traffic declines while capacity increases in July

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