IATA: ME Carriers Register 14.9 Percent Plunge in July Cargo

Published September 1st, 2020 - 06:30 GMT
IATA: ME Carriers Register 14.9 Percent Plunge in July Cargo
Asia-Pacific airlines saw demand for international air cargo fall by 15.3% in July 2020 compared to the same period a year earlier. (Shutterstock)

Middle Eastern carriers reported a decline of 14.9% in year-on-year international cargo volumes in July, an improvement from the 19% fall in June, said the International Air Transport Association (IATA), in a new report.

Seasonally-adjusted demand grew 7.2% month-on-month in July–the strongest of all regions. This recovery was driven by the aggressive operational strategies of some of the region’s carriers. International capacity decreased 27.1%, the most resilient of all regions, the report said.

African airlines posted a contraction of 3.0% in July. This was down from a 3.8% increase in demand in June. The small Africa-Asia market continued to support the region’s performance. International capacity decreased 33.7%.

Globally, air freight markets in July showed air cargo demand is stable but at lower levels than 2019, said the Iata report.

While there is some month-to-month improvement, it is at a slower pace than some of the traditional leading indicators would suggest. This is due to the capacity constraint from the loss of available belly cargo space as passenger aircraft remain parked.

Key takeaways:

• Global demand, measured in cargo tonne-kilometres (CTKs*), fell by 13.5% in July (-15.5% for international operations) compared to the previous year. That is a modest improvement from the 16.6% year-on-year drop recorded in June. Seasonally-adjusted demand grew by 2.6% month-on-month in July.

• Global capacity, measured in available cargo tonne-kilometres (ACTKs), shrank by 31.2% in July (32.9% for international operations) compared to the previous year. This is a small improvement from the 33.4% year-on-year drop in June.

• Belly capacity for international air cargo shrank by 70.5% in July compared to the previous year owing to the withdrawal of passenger services amid the COVID-19 pandemic. This was partially offset by a 28.8% increase in capacity through expanded use of freighter aircraft.

• Economic activity continued to recover in July reflected in the performance of the Purchasing Managers’ Index (PMI), an indicator of economic health in the manufacturing sector:

i) The new export orders component of the manufacturing PMI rose by 3.5 points compared to June, and was up 19.8 points since April

ii) The PMI tracking global manufacturing output returned to above 50, consistent with month-on-month growth in output

“Economic indicators are improving, but we have not yet seen that fully reflected in growing air cargo shipments. That said, air cargo is much stronger than the passenger side of the business. And one of our biggest challenges remains accommodating demand with severely reduced capacity. If borders remain closed, travel curtailed and passenger fleets grounded, the ability of air cargo to keep the global economy moving will be challenged,” said Alexandre de Juniac, IATA's Director General and CEO.

Asia-Pacific airlines saw demand for international air cargo fall by 15.3% in July 2020 compared to the same period a year earlier. After a robust initial recovery in May, month-on-month growth seasonally-adjusted demand has softened. International capacity decreased 32.0%.


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