The International Air Transport Association (IATA) recently released data for global air cargo markets showing that demand continued to track at near pre-pandemic levels in July.
IATA said global demand, measured in cargo tonne-kilometres (CTKs), fell 9.7% compared to July 2021 (down 10.2% for international operations), while demand dropped 3.5% compared to July 2019.
For the period, IATA said capacity was 3.6% above the same period in 2021, which was also up 6.8% for international operations. However, the trade association said the performance is still 7.8% below the pre-pandemic levels seen in July 2019.
IATA said several factors impacted the operating environment for the month including a decrease in all markets of new export orders — a leading indicator of cargo demand — except China which began a sharp upward trend in June.
The war in Ukraine also continued to impair cargo capacity used to serve Europe as several airlines based in Russia and Ukraine were key cargo players.
IATA added that global goods trade continued to recover in Q2 and the additional easing of COVID-19 restrictions in China will further boost recovery in the coming months. While maritime will be the main beneficiary, air cargo is also set to receive a boost.
"Air cargo is tracking at near 2019 levels although it has taken a step back compared to the extraordinary performance of 2020-2021. Volatility resulting from supply chain constraints and evolving economic conditions has seen cargo markets essentially move sideways since April," said Willie Walsh, IATA's director general.
"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," the IATA chief added.
Decline across all markets except LatAm
IATA said Asia-Pacific airlines saw their air cargo volumes decrease by 9.0% in July compared to the same month in 2021 which was a "significant decrease" over the 2.1% decline reported in June.
"Airlines in the region continue to be impacted by the conflict in Ukraine, labour shortages, and lower levels of trade and manufacturing activity due to Omicron-related restrictions. The scale of the decrease indicates volatility in volumes, as pent-up demand from the last Omicron-related lockdowns in China should prevent such notable declines in volumes," IATA said, adding that available capacity in the region increased by 2.7% compared to July 2021.
In its report, IATA noted that North American carriers also posted a 5.7% decrease in cargo volumes year-on-year for July, although this was an improvement over the 13.5% decline seen in June.
IATA said the lifting of restrictions in China is expected to boost demand in the coming months as capacity was up 4.2% compared to July 2021.
Meanwhile, European carriers saw a 17% decrease in cargo volumes in July 2022 compared to the same month in 2021 which IATA said was the "worst performance" of all regions for the third month in a row.
"This is attributable to the war in Ukraine. Labour shortages and lower manufacturing activity in Asia due to Omicron also affected volumes," the trade association added, noting that capacity barely budged and registered a 0.9% increase in July.
Middle Eastern carriers also saw a 10.9% year-on-year decrease in cargo volumes last July. IATA said significant benefits from traffic being redirected to avoid flying over Russia failed to materialize and stagnant cargo volumes to/from Europe impacted the region's performance.
For July, IATA reported that only Latin American carriers reported an increase in cargo volumes — or a 9.2% rebound in cargo volumes compared to the same period in 2021.
IATA said this was the strongest performance of all regions.
"Airlines in this region have shown optimism by introducing new services and capacity, and in some cases investing in additional aircraft for air cargo in the coming months," IATA said, while also noting a 21.4% increase in capacity for July.
African airlines also saw cargo volumes decrease by 3.5% in July 2022 compared to July 2021.
IATA noted that this was "significantly slower" than the growth recorded the previous month (5.7%).
