In the last full week of January 2023, global air cargo tonnages dropped significantly, as could be expected given the early start of the Lunar New Year, but further analysis of underlying trends reveals as well the impact of the weakening global economy on air cargo, the latest preliminary figures from WorldACD Market Data indicate.

Figures for the week of January 23 to 29 (week 4) show a decrease of 11% in worldwide tonnages compared with the previous week, mainly driven by the Lunar New Year that started on January 22.

WorldACD said the global average rate level also decreased significantly, by 9% compared with the previous week.

"However, if we look at all flows to and from Mainland China, Hong Kong, Taiwan, South Korea, Singapore, Malaysia and Vietnam combined, a drop of 37% in tonnages was recorded, whereas all other flows decreased by 5% in tonnages and by 4% in the average rate," it added.

"Therefore, the slowdown of the global economy cannot be ignored in these figures," WorldACD said.

The report noted that comparing weeks 3 and 4 with the preceding two weeks (2Wo2W), tonnages increased slightly (+1%) above their combined total in weeks 1 and 2, with a -1% decrease in capacity, while average worldwide rates dropped by -4% – based on the more than 400,000 weekly transactions covered by WorldACD's data.

On a regional level, the effect of the Lunar New Year on air cargo tonnages was most notable on flows inbound Asia Pacific from North America (-22%), Middle East & South Asia (-22%), and Europe (-5%) respectively, but also outbound Asia Pacific to North America (-14%), Middle East & South Asia (-9%) and Europe (-12%) respectively, and intra-Asia Pacific (-34%), on a 2Wo2W basis.

WorldACD said positive developments were observed on almost all other flows, especially between Europe and North America (westbound +29%; eastbound +17%), between Europe and Africa (both directions +20%) and between North America and Central & South America (northbound +57%, southbound +13%).

Volumes down year-on-year

The report noted that comparing the overall global market with this time last year, chargeable weight in weeks 3 and 4 were down 29% compared with the equivalent period last year.

Most notably, tonnages ex-Asia Pacific are down by 48% — although this comparison is skewed because last year, the Lunar New Year started ten days later, on February 1.

Meanwhile, WorldACD said overall capacity has increased by 7% compared with the previous year, with positive developments from all regions except Asia Pacific (-11%) due to the Lunar New Year.

The most notable increases were ex-Africa (+21%), ex-North America (+14%) and ex-Middle East & South Asia (+11%).

The report noted that worldwide rates are currently 28% below their levels this time last year, at an average of US$2.79 per kilo in week 4, despite the effects of higher fuel surcharges, but they remain significantly above pre-Covid levels.