During the first half of this year (1H21), the global air cargo market recorded its strongest semester of growth since 2017. This was reported by the International Air Transport Association (Iata), the representative body of the global airline and air cargo industry, when it released, on Wednesday, its latest data on the sector.
During 1H21, air cargo grew 8% globally, year-on-year. In 2017, it had registered a year-on-year growth of 10.2%. “Air cargo is doing a brisk business as the global economy continues its recovery from the Covid-19 crisis,” highlighted Iata director-general Willie Walsh. “With first half demand 8% above pre-crisis levels, air cargo is a revenue lifeline for many airlines as they struggle with border closures that continue to devastate the international passenger business. Importantly, the strong first-half performance looks set to continue.”
Total air cargo capacity remained constrained, being 10.8% below that of June 2019, because of the continued parking of so many airliners. Airliner belly cargo hold capacity last month remained 38.9% below that for June 2019. There was, however, a 29.7% increase in dedicated freighter aircraft capacity.
Economic conditions and supply chain dynamics remain very favourable and beneficial for air cargo. In the US, the business inventory to sales ratio is at a record low level; this means rapid stock replenishment, which is usually done by air cargo. Also, in most economies, the Purchasing Managers Indices are showing rapid increases, signalling increasing business confidence, manufacturing output and growing export orders. And the cost competitiveness of air cargo, in comparison to container shipping, has improved considerably, while the scheduling reliability of ocean container shipping lines has deteriorated significantly.
For June this year, air cargo demand was up 9.9% on the figure for June 2019. (The effects of the Covid-19 pandemic, including border closures and national lockdowns, distorted the market so much as to make comparisons with June 2020 meaningless; June 2019 was the last June before the pandemic, hence Iata’s use of it for comparison purposes.) The region that recorded the greatest increase last month, in comparison to June 2019, was Africa, with a jump of 32%, followed by North America, with 24%, then the Middle East (17.1%), Europe (6.7%) and the Asia-Pacific (0.9%), while Latin America registered a decline of 19.9%.