Global air cargo demand in July stable but below 2019 levels, Iata says

Middle Eastern carriers reported a 14.9% annual decline in international cargo volumes in July, an improvement from June's 19% fall

Air freight is being prepared for transport at Leipzig-Halle Airport. Air freight demand fell an annual 13.5% in July according to Iata. Getty.

Global air cargo demand in July was stable but remained below the 2019 levels due to capacity constraints as passenger aircraft remain grounded, the International Air Transport Association (Iata) said.

Air freight demand, measured in cargo tonne-kilometres, fell 13.5 per cent in July compared to the same month a year ago, Iata said in its monthly report on Tuesday.

Global capacity, dropped 31.2 per cent in July from a year ago. This is a small improvement from the annual 33.4 per cent drop in June.

While economic indicators in the global manufacturing sector are improving, with new export orders rising and output increasing, the uptick is not fully reflected in air cargo shipments, Alexandre de Juniac, Iata's director general said.

"One of our biggest challenges remains accommodating demand with severely reduced capacity," Mr de Juniac said. "If borders remain closed, travel curtailed and passenger fleets grounded, the ability of air cargo to keep the global economy moving will be challenged."

The aviation sector has been among the worst hit by the Covid-19 pandemic. The pandemic has decimated air travel demand, leading to the suspension of passenger flights and grounding of aircraft with the global economy sliding into a deep recession.

Globally, the number of coronavirus cases exceed 25.6 million and the death toll reached more than 854,000, according to Worldometer. There have been 17,942,911 recoveries.

Belly capacity for international air cargo shrank 70.5 per cent in July compared to the previous year, due to the reduction of passenger services amid the Covid-19 pandemic, Iata said. This was partially offset by a 28.8 per cent increase in capacity through the expanded use of freighter aircraft.

Middle Eastern carriers reported a 14.9 per cent annual decline in international cargo volumes in July, an improvement from the 19 per cent fall in June, according to Iata.

Seasonally-adjusted demand grew 7.2 per cent month-on-month in July – the strongest growth of all regions.

"This recovery was driven by the aggressive operational strategies of some of the region’s carriers," Iata said. "International capacity decreased 27.1 per cent, the most resilient of all regions."

African airlines posted a contraction of 3 per cent in July. This was down from a 3.8 per cent increase in demand in June. The small Africa-Asia market continued to support the region’s performance. International capacity decreased 33.7 per cent.

Carriers in Europe reported a 22.4 per cent annual drop in international cargo volumes in July. This was a slight improvement from June’s performance of a 27.6 per cent drop.

"Demand on most key trade lanes to / from the region remained weak," the report said. "The large Europe–Asia market was down 20 per cent year-on-year in July." International capacity decreased 37.4 per cent.

Airlines in North America posted a single-digit fall in international cargo demand of 5.4 per cent year-on-year in July.

"The stronger performance is due in part to strong demand on the transpacific, Asia-North America route, reflecting e-commerce demand for products manufactured in Asia," Iata said. International capacity decreased 30.9 per cent.

Carriers in the Asia-Pacific region saw demand for international air cargo fall 15.3 per cent in July 2020 compared to the same period a year earlier.

Latin American operators posted a 32.1 per cent drop in year-on-year international demand in July, down from a 28.6 per cent decline in June. International capacity decreased 44.5 per cent.

"The drop in both demand and capacity was the most severe of all regions," Iata said. "The Covid-19 crisis is particularly challenging at present for airlines based in Latin America owing to strict lock-down measures."

In July, the Latin American air cargo market was smaller than the African market for the first time since the start of data being reported in 1990, according to Iata.