Middle Eastern carriers see year-on-year fall in cargo

Muscat: Middle Eastern carriers experienced an 8.1 percent year-on-year decrease in cargo volumes in February 2023, according to a new report.

“This was a slight improvement to the previous month (-11.8 percent). Capacity increased 9.3 percent compared to February 2022,” International Air Transport Association (IATA) said in its latest report.
Global air cargo markets are showing that air cargo demand rose above pre-pandemic levels, the Geneva-based IATA said in its report.

Global demand, measured in cargo tonne-kilometres (CTKs*), fell 7.5 percent compared to February 2022 (-8.3 percent for international operations). This was half the rate of annual decline seen in the previous two months (-14.9 percent and -15.3 percent respectively). February demand for air cargo was 2.9 percent higher than pre-pandemic levels (February 2019)—the first time it has surpassed pre-pandemic levels in eight months.

The report further said that capacity (measured in available cargo tonne-kilometres, ACTK) was up 8.6 percent compared to February 2022. The strong uptick in ACTKs reflects the addition of belly capacity as the passenger side of the business continues to recover. International belly capacity grew by 57.0 percent in February year-over-year, reaching 75.1 percent of the 2019 (pre-pandemic) capacity.
IATA said that several factors in the operating environment should be noted.

The global new export orders component of the manufacturing PMI, a leading indicator of cargo demand, continued to increase in February. China’s PMI level surpassed the critical 50-mark indicating that demand for manufactured goods from the world’s largest export economy is growing.

Global goods trade decreased by 1.5 percent in January; this was a slower rate of decline than the previous month of -3.3 percent.

The Consumer Price Index for G7 countries decreased from 6.7 percent in January to 6.4 percent in February. Inflation in producer (input) prices reduced by 2.2 percentage points to 9.6 percent in December (last available data).

“The story of air cargo in February is one of slowing declines. Year-on-year demand fell by 7.5 percent. That’s half the rate of decline experienced in January. This shifting of gears was sufficient to boost the overall industry into positive territory (+2.9 percent) compared to pre-pandemic levels,” said Willie Walsh, IATA’s Director General.

“An optimistic eye could see the start of an improvement trend that leads to market stabilisation and a return to more normal demand patterns after dramatic ups and downs in recent years,” he further added.