Global air cargo market continues upward trend in the month of July

Global air freight demands races to the bottom

IATA’s data for global air cargo markets shows that July was a solid month as cargo demand continued its strong growth trend.

As per the data, the Global demand, measured in cargo tonne-kilometres (CTKs), was up 8.6% in July 2021 as compared to July 2019. While the overall growth remains strong compared to the long-term average growth trend of around 4.7%. The pace of growth slowed slightly compared to June which saw demand increase 9.2% (against pre-COVID-19 levels).

Capacity continues to recover but is still 10.3% down compared to July 2019.

The data further said that the economic conditions continue to support the air cargo growth. The July export orders component of the manufacturing Purchasing Managers Indices (PMIs) was 52.7%, indicating a short-term boost to demand if those orders are shipped by air.

However, the inventory-to-sales ratio remains low ahead of the peak year-end retail season.

“July was another solid month for global air cargo demand. Economic conditions indicate that the strong growth trend will continue into the peak year-end demand period. The Delta variant of COVID-19 could bring some risks. If supply chains and production lines are disrupted, there is potential for a knock-on effect for air cargo shipments,” said IATA’s  Walsh.

Speaking of the regional demand in the month of July, the data revealed that the month brought an increase in demand for regions like Asia Pacific, North America, Europe and the Middle East. However, Latin America suffered a decline.

North American posted a 20.5% increase in international demand in July 2021 compared to July 2019. This was in line with June’s performance (19.8%) and the strongest of all regions.  While the European carriers posted a 6.0% increase in demand in July 2021 compared to the same month in 2019. This was a marginal decrease compared to the previous month (6.8%). 

The demand for international air cargo in Asia-Pacific recorded an increase by 4.4% in July 2021 compared to the same month in 2019, an improvement compared to the previous month’s 3.9% expansion.

An 11.3% rise in international cargo volumes was posted by the Middle Eastern carriers in July 2021 versus July 2019. Although it was a decrease compared to the previous month (15.8%), some routes, are still posting strong performance, for example on the large Middle East–Asia trade lanes.

Among all Latin American carriers were the only ones who reported a decline in demand. The region posted a decline of 10.2% in international cargo volumes in July compared to the 2019 period. However, it is still an improvement from the -21.5% fall recorded by the region in June 2021.

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