A cargo handler prepares air freight containers for a British Airways flight at Heathrow Airport. The booming e-commerce sector is continuing to help air cargo demand to trend above growth in both trade and production since the last quarter of 2023.
Air freight plays a crucial role in global economy, providing a fast and efficient means of transporting goods across the world.
The booming e-commerce sector is continuing to help air cargo demand to trend above growth in both trade and production since the last quarter of 2023.Air cargo demand was up 18.4% year-on-year in January, according to data provided by the International Air Transport Association.Total air cargo demand, measured in cargo tonne-kilometres (CTKs), up 18.4% on January 2023 levels (19.8% for international operations).This significant upturn marks the highest annual growth in cargo tonne-kilometres (CTKs) since the summer season of 2021.Capacity, measured in available cargo tonne-kilometres (ACTKs), was up 14.6% compared to January 2023 (18.2% for international operations).This was largely related to the growth in belly capacity. International belly capacity rose 25.8% year-on-year (YoY) on the strength of passenger markets.Air cargo growth outpaced trade and production, IATA said and noted several factors in the operating environment.First, it said the global cross-border trade increased by 1% in December compared to the previous month (-0.2% YoY).In January, the manufacturing output Purchasing Managers' Index (PMI) improved to 50.3, surpassing the 50 mark for the first time in eight months, indicating expansion.The new export orders PMI also saw an increase to 48.8, but remains below the critical 50 threshold, suggesting a continuing yet decelerating decline in global exports.Inflation in major economies continued to ease from its peak in terms of Consumer Price Index (CPI) in January, reaching 3.1% in both the US and in the EU, and 2.1% in Japan.China’s CPI, however, indicated deflation for the fourth consecutive month, raising concerns of an economic slowdown. China’s negative inflation rate of -0.8% was the lowest since the Global Financial Crisis in 2009.In terms of regional performance, IATA said Middle Eastern carriers have had the strongest performance in January this year, with a 25.9% year-on-year increase in cargo volumes. This was a significant improvement from the previous month’s performance (+18.3%).Carriers in the region benefited from growth in the Middle East–Asia (+29.5%) and Middle East–Europe markets (+46.1%). Capacity increased 17.1% compared to January 2023.Asia-Pacific airlines saw their air cargo volumes increase by 24.6% in January 2024 compared to the same month in 2023. This performance was above the previous month (+18.5%).Carriers in the region benefitted from ongoing growth in international CTKs on three major trade lanes: Africa-Asia (+52.5%), Middle East-Asia (+29.5%) and Europe-Asia (+27.5%). Available capacity for the region’s airlines increased by 25.0% compared to January 2023 as more belly capacity came online from the passenger side of the business.However, North American carriers had the weakest performance of all regions in January with a 9.3% increase (YoY) in cargo volumes. This was an improvement in performance compared to December (2.0%).Carriers in the region benefitted from growth on the North America-Asia trade lane (+17.1%) and North America-Europe trade lane (+3.5%). Capacity increased by 3.8% compared to January 2023.On the other hand, European carriers saw their air cargo volumes increase by 16.4% in January compared to the same month in 2023. This was a stronger performance than in December (+8.6%). Carriers in the region benefited from the strong growth in international CTKs in the within Europe market (+18.4%) and the Europe – Asia route (+27.5%).Gains made from the significant expansion in the Middle East-Europe trade lane (+46.1%) also benefited carriers in the region. Capacity increased 12.5% in January 2024 compared to the same month in 2023.African airlines saw their air cargo volumes increase by 17.0% in January 2024, much improved compared to December’s performance (-1.2%).Carriers in the region benefitted from strong growth on the Africa-Asia trade lane. Capacity in January was 19.4% above January 2023 levels.IATA Director General Willie Walsh noted, "Air cargo demand was up 18.4% year-on-year in January. This is a strong start to the year. In particular, the booming e-commerce sector is continuing to help air cargo demand to trend above growth in both trade and production since the last quarter of 2023."The counterweight to this good news is uncertainty over how China’s economic slowdown will unfold. This will be on the minds of air cargo executives meeting in Hong Kong next week for the IATA World Cargo Symposium with an agenda focused on digitalisation, efficiency and sustainability."Undoubtedly, air freight is a key enabler of global trade, connecting businesses and consumers worldwide, and contributing significantly to the efficiency and resilience of the global economy.