The International Air Transport Association (IATA) released data for October 2022 global air cargo markets showing that headwinds continue to affect air cargo demand.
- Global demand, measured in cargo tonne-kilometers (CTKs*), fell 13.6% compared to October 2021 (-13.5% for international operations).
- Capacity was 0.6% below October 2021. This was the first year-on-year contraction since April 2022, however, month-on-month capacity increased by 2.4% in preparation for the year-end peak season. International cargo capacity grew 2.4% compared to October 2021.
- Several factors in the operating environment should be noted:
- New export orders, a leading indicator of cargo demand, are shrinking in all markets except China and South Korea, which registered slightly higher new export orders in October.
- Latest global goods trade figures showed a 5.6% expansion in September, a positive sign for the global economy. This is expected to primarily benefit maritime cargo, with a slight boost to air cargo as well.
- The US dollar has seen a sharp appreciation, with the broad real effective exchange rate in September 2022 reaching the highest level since 1986. A strong dollar affects air cargo. As many costs are denominated in dollars, the currency’s appreciation adds another layer of cost on top of high inflation and high jet fuel prices.
- The Consumer Price Index increased slightly in G7 countries in October and remains at a decades’ high level of 7.8%. Inflation in producer (input) prices reduced by 0.5 percentage points to 13.3% in September.
“Air cargo continues to demonstrate resilience as headwinds persist. Cargo demand in October — while tracking below the exceptional performance of October 2021– saw a 3.5% increase in demand compared to September,” said Willie Walsh, IATA’s Director General.