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IATA says global air cargo demand fell 11.2% y-o-y in April
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Capacity fell 2% below 2021 levels, but rose 1.2% for international operations
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China lifting of lockdown sparks optimism and supply/demand imbalance keeps yields high, says IATA
Global air cargo demand shrank in April as capacity contracted amid an Omicron wave in Asia and Russia’s war on Ukraine that continued to pose challenges to operators, the International Air Transport Association (IATA) said in an industry update on June 8.
The Geneva-based organization said global demand, measured in cargo ton-kilometers (CTKs), fell 11.2% from the April 2021 level (down 10.6% for international operations). The April demand drop was 1% below the April 2019 level.
Capacity was 2% below 2021 levels, but rose 1.2% for international operations. Both global capacity and international capacity decreased slightly month on month in April, with Asia experiencing the largest declines, IATA said.
“The combination of the war in Ukraine and COVID-19 lockdowns in China have pushed up energy costs, intensified supply chain disruptions, and fed inflation,” said Willie Walsh, IATA’s director general.
“The operating environment is challenging for all businesses, including air cargo. But with China easing lockdown restrictions, there is cause for some optimism and the supply/demand imbalance is keeping yields high,” he said.
The group identified the key factors in the operating environment as follows:
- The war in Ukraine that led to a fall in cargo capacity used to serve Europe, as several airlines based in Russia and Ukraine were key cargo players.
- The zero-COVID policy in China that led to capacity challenges due to flight cancellations prompted by labor shortages.
- New export orders, a leading indicator of cargo demand and world trade are now shrinking in all markets except the US.
- Global goods trade has continued to decline in 2022, with China’s economic growth slowed by COVID-related lockdowns that have brought much of the world’s largest port, Shanghai, to a standstill. Supply chain disruptions due to the Ukraine-Russia conflict are also adding to the downward pressure on trade.
Regional performance in April
Asia-Pacific airlines saw cargo volumes fall 15.8% year on year in April, the regions’ weakest performance and significantly lower than the 5.1% slip in March, IATA said. APAC carriers have been hit by lower trade and manufacturing activity due to Omicron-related lockdowns in China. Available capacity in the region fell 19.4% y-o-y, the largest drop of all regions.
North American carriers’ cargo volumes fell 6.6% y-o-y in April. Demand in the Asia-North America market dropped significantly, but other key routes such as Europe–North America remain strong. Capacity rose 5.2% y-o-y. Several carriers in the region are set to take delivery of freighters in 2022, which should help address pent-up demand on routes where it is needed.
European carriers’ cargo volumes slid 14.4% y-o-y in April. The Within Europe market fell 24.6% month on month, impacted by the war in Ukraine. Labor shortages and lower production activity in Asia due to Omicron also hit volumes. Capacity fell 0.2% y-o-y in April.
Middle Eastern carriers posted an 11.9% y-o-y drop in cargo volumes in April. Significant benefits from traffic being redirected to avoid flying over Russia failed to materialize. This was likely due to persisting supply chain issues in Asia. Capacity grew 6% y-o-y.
Latin American carriers reported a 40.9% jump in cargo volumes in April, the strongest performance of all regions. Airlines introduced new services and capacity and, in some cases, investing in additional freighters in coming months. Capacity in April was up 67.8% y-o-y.
African airlines saw cargo volumes decrease 6.3% y-o-y in April, significantly slower than the growth recorded the previous month (3.1%). Capacity was 1.5% below April 2021 levels.
