IATA: Air cargo optimism to be balanced with caution

Air cargo traffic increased year on year for the third month in a row in October, but IATA has warned that optimism over the improvements should be balanced with caution.

The latest figures from the airline association show that cargo tonne kms (CTK) increased by 3.8% year on year in October, while capacity was up 13.1% as bellyhold operations continued to return.

As a result of capacity increasing faster than demand, the overall load factor was down four percentage points compared with last year to 45.2%.

IATA said that while it was welcome news that demand was on the up, there was still much uncertainty.

The association pointed out that demand was still below 2019 levels and that economic activity slowed in October, with the Purchasing Managers Index for manufacturing output remaining below the 50-point mark to indicate declining output.

On the other hand, inflation in advanced economies continued to ease, global trade indicators stabilised and air cargo yields picked up in September and October after 17 months of decline.

IATA director general Willie Walsh said: “Demand for air cargo was up 3.8% in October. That marks three consecutive months of year-on-year growth, placing air cargo on course to end 2023 on a much stronger footing than it began the year.

“Recovering demand, slightly stronger yields and the uptick in trade are all good news. But with demand still 2.4% below pre-pandemic levels, and much uncertainty remaining over the trajectory of the global economy, optimism must be balanced with caution.

“Nonetheless, a continued strong peak year-end season will certainly help the sector to manage through whatever turns the global economy might take in 2024.”

Source: IATA

Looking at regional performance, Asia Pacific airlines saw their air cargo traffic increase by 7.6% year on year in October while capacity was up 30%.

“Carriers in the region benefited from ongoing growth in international CTK’s on three major trade lanes: Africa-Asia (+16.7%, the greatest annual growth since May), Middle East-Asia (+10.3%) and Europe-Asia (+8.5%),”  IATA said.

North American carriers had the weakest performance in October with a 1.8% decrease.

“This was a slight improvement in performance compared to September (-2.2%),” IATA commented.

It added that the North America-Asia trade lane recorded an increase in international CTKs and the North America-Europe market saw a slight improvement in international CTKs.

European carriers saw their air cargo volumes increase by 1% year on year in October.

Carriers in the region benefitted from improvements in the “within Europe” market for the first time since January 2022 and also expansion in the Middle East-Europe trade lane.

Middle Eastern carriers had the strongest performance in October 2023, with a 10.9% year-on-year increase in cargo volumes.

Latin American carriers experienced a 4% increase in cargo volumes.

Finally, African airlines saw their air cargo volumes increase by 2.9% in October following a decline in September.