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Air Cargo Demand Up 2.9% in February

Global air cargo demand rose 2.9 percent in February compared to a year earlier, the International Air Transport Association (IATA) reported Wednesday.

The IATA said demand increased despite a challenging operating backdrop, with several factors benefiting air cargo in February compared to January. On the demand side, manufacturing activity ramped up quickly after the early February Lunar New Year holiday and capacity was positively influenced by the general and progressive relaxation of Covid-19 travel restrictions, reduced flight cancellations due to Omicron-related factors, outside of Asia, and fewer winter weather operational disruptions.

While cargo volume continued to rise, the growth rate decelerated from the 8.7 percent year-on-year expansion in December. Capacity was 12.5 percent above February 2021 and while this is in positive territory, compared to pre-Covid levels, capacity remains constrained at 5.6 percent below February 2019, IATA noted.

The zero-Covid policy in China and Hong Kong continues to create supply chain disruptions as a result of flight cancellations due to labor shortages and because many manufacturers cannot operate normally, IATA said. In addition, the impact of Russia’s invasion of Ukraine had limited effect globally on February’s performance as it occurred very near the end of the month. The negative impacts of war and related sanctions, particularly higher energy costs and reduced trade, will become more visible from March, IATA predicted.

“Demand for air cargo continued to expand despite growing challenges in the trading environment,” said Willie Walsh, IATA’s director general. “That is not likely to be the case in March as the economic consequences of the war in Ukraine take hold. Sanction-related shifts in manufacturing and economic activity, rising oil prices and geopolitical uncertainty will take their toll on air cargo’s performance.”

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Looking at performance by region, Asia-Pacific airlines saw their air cargo volume increase 3 percent in February compared to the same month in 2021. Available capacity in the region was up 15.5 percent in the same comparison. The zero-Covid policy in mainland China and Hong Kong is impacting performance.

North American carriers posted a 6.1 percent year-over-year increase in cargo volume in February.

“The ramp up of manufacturing activity in China following the end of the Lunar New Year resulted in growth in the Asia–North America market, with seasonally adjusted volumes rising by 4.3 percent in February,” IATA said. “Capacity was up 13.4 percent compared to February 2021.”

European airlines saw a 2.2 percent gain in cargo volume in February compared to the same month in 2021. This was slower than the previous month, partially attributable to the war in Ukraine that started at the end of the month,” IATA noted.

Seasonally adjusted demand on the Asia-Europe route, one of the most affected by the conflict, decreased 2 percent month on month. Capacity was up 10 percent.

Middle Eastern carriers experienced a 5.3 percent year-on-year decrease in cargo volumes in the month, while capacity was up 7.2 percent compared to February 2021.

“This was the weakest performance of all regions, which was owing to a deterioration in traffic on several key routes such as Middle East-Asia and Middle East-North America,” IATA said. “Looking forward, there are signs of improvement as data indicate that the region is likely to benefit from traffic being redirected to avoid flying over Russia.”

Latin American carriers reported an increase of 21.2 percent in cargo volume for the month from February 2021, the strongest performance of all regions. Some of the largest airlines in the region are benefiting from the end of bankruptcy procedures, IATA note. Capacity in February was up 18.9 percent compared to the same month in 2021.

African airlines saw cargo volume rise 4.6 percent, as capacity was 8.2 percent above February 2021.