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IATA: Air cargo demand drops in March amid “growing challenges” – Air Cargo News

Covid, the Ukraine war and oil prices all contributed to a drop in demand in global air cargo markets in March, according to data from the International Air Transport Association (IATA).

Cargo demand is tracking below pre-Covid-19 levels, and like February, capacity remained constrained.

Global demand, measured in cargo tonne-kilometers (CTKs), fell 5.2% compared to March 2021 (-5.4% for international operations).

Capacity was 1.2% above March 2021 (+2.6% for international operations). While this is in positive territory, it is a significant decline from the 11.2% year-on-year increase in February. Asia and Europe experienced the largest falls in capacity.

Asia Pacific airlines saw their air cargo volumes decrease by 5.1% in March 2022 compared to the same month in 2021. Available capacity in the region fell 6.4% compared to March 2021.

North American carriers posted a 0.7% decrease in cargo volumes in March 2022 compared to March 2021. Demand in the Asia-North America market declined significantly, with seasonally adjusted volumes falling by 9.2% in March.  Capacity was up 6.7% compared to March 2021.

European carriers saw a 11.1% decrease in cargo volumes in March 2022 compared to the same month in 2021. Capacity fell 4.9% in March 2022 compared to March 2021. 

Middle Eastern carriers experienced a 9.7% year-on-year decrease in cargo volumes in March. Capacity was up 5.3% compared to March 2021.

Latin American carriers reported an increase of 22.1% in cargo volumes in March 2022 compared to the 2021 period. Capacity in March was up 34.9% compared to the same month in 2021. 

African airlines saw cargo volumes increase by 3.1% in March 2022 compared to March 2021. Capacity was 8.7% above March 2021 levels. 

“The war in Ukraine led to a fall in cargo capacity used to serve Europe as several airlines based in Russia and Ukraine were key cargo players,” said IATA. “Sanctions against Russia led to disruptions in manufacturing. And rising oil prices are having a negative economic impact, including raising costs for shipping.” (continues below dashboard)

The zero-Covid policy in mainland China and Hong Kong is impacting performance in the Asia Pacific region; while the Ukraine war saw the market within Europe drop 19.7% month on month and demand was affected by labour shortages and lower manufacturing activity in Asia due to Omicron, said the trade association.

Significant benefits for the Middle East market from traffic being redirected to avoid flying over Russia failed to materialise. This is likely due to subdued demand overall.

Latin America’s strong performance is partly because some of the largest airlines in the region are benefitting from the end of bankruptcy protection.

“Air cargo markets mirror global economic developments. In March, the trading environment took a turn for the worse,” said Willie Walsh, IATA’s director general.

“The combination of war in Ukraine and the spread of the Omicron variant in Asia have led to rising energy costs, exacerbated supply chain disruptions, and fed inflationary pressure. As a result, compared to a year ago, there are fewer goods being shipped—including by air.

“Peace in Ukraine and a shift in China’s Covid-19 policy would do much to ease the industry’s headwinds. As neither appears likely in the short-term, we can expect growing challenges for air cargo just as passenger markets are accelerating their recovery.”

IATA: Air cargo up in February but uncertainty looms

Air cargo growth in January “below expectations”

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