Air Cargo Makes a Soft Start to 2023, European Carriers Fare the Worst

Our Bureau - : Mar 8, 2023 - : 12:36 am

With headwinds persisting, air cargo demand declined in January, according to data on global air cargo markets released by the International Air Transport Association (IATA). Europe recorded the weakest performance in the month, followed closely by carriers in the Asia...

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Global demand, measured in cargo tonne-kilometers (CTKs*), fell 14.9% compared to January 2022 (-16.2% for international operations).

Capacity (measured in available cargo tonne-kilometers, ACTK) was up 3.9% compared to January 2022. This was the first year-on-year growth in capacity since October 2022. International cargo capacity increased 1.4% compared to January 2022. The uptick in ACTKs reflects the strong recovery of belly capacity in passenger airline markets offsetting a decline international capacity offered by dedicated freighters.

European carriers saw a 20.4% decrease in cargo volumes in Januarycompared to the same month in 2022. This was a decrease in performance compared to December (-19.4%). Airlines in the region continue to be most affected by the war in Ukraine. Capacity decreased 9.3% in January this year compared to January 2022.

Asia-Pacific airlines saw their air cargo volumes decrease by 19% in January compared to the same month in 2022. This was an improvement in performance compared to December (-21.2%). North American carriers posted an 8.7% decrease in cargo volumes while Middle Eastern carriers experienced a 11.8% year-on-year decrease. African airlines saw cargo volumes go drop by by 9.5% while Latin American carriers reported a 4.6% increase in cargo volumes.

The global new export orders component of the manufacturing PMI, a leading indicator of cargo demand, increased in January for the first time since October 2022. For major economies, new export orders are growing, and in China and the US, PMI levels are close to the critical 50-mark indicating that demand for manufactured goods from the world's two largest economies is stabilizing.

Global goods trade decreased by 3.0% in December, this was the second monthly decline in a row. The Consumer Price Index for G7 countries decreased from 7.4% in November to 6.7% in January. Inflation in producer (input) prices reduced by 2.2 percentage points to 9.6% in December.

"With January cargo demand down 14.9% and capacity up 3.9%, 2023 began under some challenging business conditions," said said Willie Walsh, IATA's Director General. "That was accompanied by persistent uncertainties, including war in Ukraine, inflation, and labor shortages. But there is solid ground for some cautious optimism about air cargo. Yields remain higher than pre-pandemic. And China's much faster than expected shift from its zero COVID policy is stabilizing production conditions in air cargo's largest source market."

Asia-pacific / Air-cargo / International-air-transport-association-iata / Headwinds /

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