AIR CARGO DEMAND REMAINS WEAK IN MAY
On 5 July, the International Air Transport Association (IATA) released data highlighting the weak market conditions in global air cargo markets for May 2023. The report reveals that global demand, measured in cargo tonne-kilometres (CTKs), experienced a decline of 5.2% compared to May 2022, with international operations witnessing an even greater drop of 6.0%.
In line with this development, capacity, measured by available cargo tonne-kilometres (ACTKs), showed a significant increase of 14.5% compared to May 2022. This growth can be primarily attributed to the recovery in passenger business, leading to an increase in belly capacity. Capacity levels have now surpassed pre-pandemic levels, standing at 5.9% above May 2019 figures.
European carriers experienced a 6.7% decrease in cargo volumes in May 2023 compared to the same month in 2022. However, this performance showed improvement compared to April (-7.7%), partly due to a smaller annual contraction in international CTKs on the Europe-Middle East trade lane. Additionally, the decline in international cargo traffic within Europe improved from -16.2% in April to -7.8% in May (seasonally adjusted). Meanwhile, capacity increased by 5.6% in May 2023 compared to May 2022.
Willie Walsh, IATA’s Director General, stated that air cargo faces ongoing challenges due to a 5.2% decrease in demand and various economic indicators signalling weakness. Nonetheless, he argued that in the second half of the year there will be expected improvements. This is because, as inflation decreases and central banks reduce rate hikes, economic activity is likely to increase, resulting in a positive effect on air cargo demand.
Source: IATA