IATA Data Confirms Global Air Freight Tonnages Have Risen

WORLDWIDE – The trend reported to us by a variety of international air cargo carriers and individual airports has been confirmed with the publication of the latest data from the International Air Transport Association (IATA).

The figures show full-year demand for air cargo increased by 6.9% in 2021, compared to 2019 (pre-Covid levels) and 18.7% compared to 2020 following a strong performance in December 2021. This was the second biggest improvement in year-on-year demand since IATA started to monitor cargo performance in 1990 (behind 2010’s 20.6% gain), outpacing the 9.8% rise in global goods trade by 8.9 percentage points.

With distortion of comparisons between 2021 and the previous year due to the influence of the virus, IATA has noted the changes as against pre Covid levels in 2019. That overall rise of 6.9% was actually exceeded if one includes only international operations which rose 7.4%. Meanwhile capacity in 2021, measured in available cargo tonne-kilometres (ACTKs), was 10.9% below 2019 (12.8% for international operations).

IATA warns that capacity remains constrained with bottlenecks at key hubs. The lack of available capacity contributed to increased yields and revenues, providing support to airlines and some long-haul passenger services in the face of collapsed passenger revenues. In December 2021, rates were almost 150% above 2019 levels and IATA says economic conditions continue to support air cargo growth.

In December global demand was 8.9% above 2019 levels (9.4% for international operations). This was a significant improvement from the 3.9% increase in November and the best performance since April 2021 (11.4%). Global capacity was 4.7% below 2019 levels (6.5% for international operations). Global goods trade rose 7.7% in November (latest month of data), compared to pre-crisis levels. Global industrial production was up 4.0% over the same period.

Global goods trade rose 7.7% in November (latest month of data), compared to pre-crisis levels. Global industrial production was up 4.0% over the same period and the inventory-to-sales ratio remains low. This is positive for air cargo as manufacturers turn to air cargo to rapidly meet demand and, in IATA’s view, the cost-competitiveness of air cargo relative to that of sea-container shipping remains favourable.

Whilst labour shortages, partly due to employees being in quarantine, insufficient storage space at some airports and processing backlogs continue to put pressure on supply chains, the Omicron virus and consequent recent surge in Covid-19 cases in many advanced economies has created strong demand for PPE shipments, which are usually carried by air.

The December global Supplier Delivery Time Purchasing Managers Index (PMI) was at 38. While values below 50 are normally favourable for air cargo, in current conditions it points to delivery times lengthening because of supply bottlenecks. Willie Walsh, IATA’s Director General commented:

“Air cargo had a stellar year in 2021. For many airlines, it provided a vital source of revenue as passenger demand remained in the doldrums due to Covid-19 travel restrictions. Growth opportunities, however, were lost due to the pressures of labour shortages and constraints across the logistics system. Overall, economic conditions do point towards a strong 2022.

“Some relief on supply chain constraints occurred naturally in December as volumes decreased after peak shipping activity ended in advance of the Christmas holiday. This freed capacity to accommodate front-loading of some Lunar New Year shipments to avoid potential disruptions to flight schedules during the Winter Olympic Games.

”And overall December cargo performance was assisted by additional belly-hold capacity as airlines accommodated an expected year-end boost to travel. As shortages of labour and storage capacity remain, governments must keep a sharp focus on supply chain constraints to protect the economic recovery.”

Strong variations were evident in the regional performance of air cargo in 2021 compared to 2019. North American carriers were the strongest performers, reporting an annual increase in international demand of 20.2%. Middle East and African carriers also reported double digit growth in international demand in 2021 (10.6% and 11.3%, respectively) compared to 2019.

Asia-Pacific and European carriers saw international demand rise 3.6% in 2021 compared to 2019. And Latin American carriers were the only ones to record a contraction in international demand of 15.2% compared to 2019.