Air cargo declines continue to narrow in July
05 / 09 / 2023
Declines in air cargo volumes narrowed to their lowest level of the year so far in July as the market continued to show signs of bottoming out.
The latest figures from IATA show that in July air cargo traffic in cargo tonne km (CTK) terms fell 0.8% year on year – the narrowest decline registered since February 2022.
Capacity in available CTK was up 11.2% on last July and the cargo load factor was down 5.1 percentage points to 42.1%.
“Although demand is now basically flat compared to 2022, this is an improvement on recent months’ performance that is particularly significant given declines in global trade volumes and rising concerns over China’s economy,” IATA said.
IATA said that during the month both the Purchasing Managers Index and New Export Orders index indicated a decline in manufacturing and exports.
The association’s director general, Willie Walsh, was “cautiously optimistic”.
“Compared to July 2022, demand for air cargo was basically flat,” he said.
“Considering we were 3.4% below 2022 levels in June, that’s a significant improvement. And it continues a trend of strengthening demand that began in February.
“How this trend will evolve in the coming months will be something to watch carefully.
“Many fundamental drivers of air cargo demand, such as trade volumes and export orders, remain weak or are deteriorating.
“And there are growing concerns over how China’s economy is developing. At the same time, we are seeing shorter delivery times, which is normally a sign of increasing economic activity.
“Amid these mixed signals, strengthening demand gives us good reason to be cautiously optimistic.”
On regional performance, airlines based in the Asia-Pacific region saw their air cargo volumes increase by 2.7% year on year in July.
“This was a significant improvement in performance compared to June (-3.3%),” said IATA.
“Carriers in the region benefited from growth on three major trade lanes: Europe-Asia (3.2% year-on-year growth), Middle East-Asia (up from 1.8% in June to 6.6% in July), and Africa-Asia (returning to double-digit growth of 10.3% year-on-year from -4.8% in June).
“Additionally, the within-Asia trade lane also performed considerably better in July, with an annual decline of international CTKs at 7.5% compared with the double-digit decreases observed since September 2022.”
IATA stats show that North American carriers posted the weakest performance of all regions, with a 5.2% decrease in cargo volumes during the month.
This was the fifth consecutive month in which the region had the weakest performance.
European carriers saw their air cargo volumes decline by 1.5% in July compared to the same month in 2022.
“Volumes were affected due to the aforementioned Europe–North America performance and contractions in the Middle East-Europe (-1.2%) and the within-Europe (-5.1%) markets,” IATA said.
Middle Eastern carriers experienced a 1.5% year-on-year increase in cargo volumes as demand on Middle East–Asia routes has been trending upward in the past two months.
Latin American carriers posted a 0.4% increase in cargo volumes and African airlines had the strongest performance with a 2.9% increase on the back of improvements on the Africa-Asia trade lane.