IATA’s Report Shows Drop in Cargo Demand
The International Air Transport Association (IATA) released April 2022 data for global air cargo markets showing a drop in demand and contraction in capacity.
The body said the effects of Omicron in Asia and the Russia–Ukraine war continue to create a challenging operating backdrop that is driving the decline.
Global demand, measured in cargo tonne-kilometers (CTKs), fell 11.2 per cent compared to April 2021 (-10.6 per cent for international operations). Global demand is down 1% compared to April 2019.
Capacity was 2 per cent below 2021 (+1.2 per cent for international operations). Both global capacity and international capacity decreased slightly in April compared to March. Asia experienced the largest falls in capacity.
IATA identified factors to include the war in Ukraine, which led to a fall in cargo capacity used to serve Europe as several airlines based in Russia and Ukraine were key cargo players. And the zero-COVID-19 policy in China led to capacity challenges due to flight cancellations because of labor shortages.
Another factor is new export orders, as IATA explained that a leading indicator of cargo demand and world trade are now shrinking in all markets except the US Global goods, remarking that trade has continued to decline in 2022, with China’s economy growing more slowly because of COVID-19 related lockdowns (among other factors).
The lockdowns 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.
“Air cargo demand fell by 11.2 per cent in April and capacity contracted 2% compared to April 2021. 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. 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,” said IATA’s Director General, Willie Walsh.