IATA calls 2021 stellar year for air cargo; registers second biggest demand growth

The International Air Transport Association (IATA) released data for global air freight markets showing that full-year demand for air cargo increased by 6.9 percent in 2021, compared to 2019 (pre-covid levels) and 18.7 percent compared to 2020 following a strong performance in December 2021.

Update: 2022-01-31 10:10 GMT
IATA calls 2021 stellar year for air cargo; registers second biggest demand growth

January 31, 2022: The International Air Transport Association (IATA) released data for global air freight markets showing that full-year demand for air cargo increased by 6.9 percent in 2021, compared to 2019 (pre-covid levels) and 18.7 percent 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 percent gain), outpacing the 9.8 percent rise in global goods trade by 8.9 percentage points.

Capacity in 2021, measured in available cargo tonne-kilometres (ACTKs), was 10.9 percent below 2019 (12.8 percent for international operations). Capacity remains constrained with bottlenecks at key hubs.

Improvements were demonstrated in December; global demand was 8.9 percent above 2019 levels (9.4 percent for international operations).  This was a significant improvement from the 3.9 percent increase in November and the best performance since April 2021 (11.4 percent). Global capacity was 4.7 percent below 2019 levels (‑6.5 percent for international operations).

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 percent above 2019 levels.

“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,” said Willie Walsh, IATA’s director-general.

“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 labor and storage capacity remain, governments must keep a sharp focus on supply chain constraints to protect the economic recovery,” said Walsh. 

According to IATA, the economic conditions continue to support air cargo growth.

“Global goods trade rose 7.7 percent in November (latest month of data), compared to pre-crisis levels. Global industrial production was up 4.0 percent over the same period. The inventory-to-sales ratio remains low. This is positive for air cargo as manufacturers turn to air cargo to rapidly meet demand. The cost-competitiveness of air cargo relative to that of sea-container shipping remains favorable,” reads the release.

The recent surge in Covid-19 cases in many advanced economies has created strong demand for PPE shipments, which are usually carried by air.

The association also noted down that supply chain issues slowed the pace of growth in November remain as headwinds.

Labor 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 December global Supplier Delivery Time Purchasing Managers Index (PMI) was at 38. While values below 50 are normally favorable for air cargo, in current conditions it points to delivery times lengthening because of supply bottlenecks,” reads the release.

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 percent. Middle East and African carriers also reported double-digit growth in international demand in 2021 (10.6 percent and 11.3 percent, respectively) compared to 2019. Asia-Pacific and European carriers saw international demand rise 3.6 percent in 2021 compared to 2019. And Latin American carriers were the only ones to record a contraction in international demand of 15.2 percent compared to 2019.

Africa 
Airlines saw international demand grow 11.3 percent in 2021 compared to 2019 and a fall in the international capacity of 14.6 percent. Growth in the region has been dynamic for most of the year, driven by the strength of the Africa-Asia route. In December, international demand grew by 7.6 percent year-on-year and international capacity fell 19.4 percent.

Source: stattimes.com

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