The International Air Transport Association (IATA) released data for November 2023 global air cargo markets indicating the strongest year-on-year growth in roughly two years.
This is partly due to weakness in November 2022, but also reflects a fourth consecutive month of strengthening demand for air cargo.
November 2023 Overview
November 2023 marked a further month witnessing the air cargo sector’s steady resurgence after a challenging period.
Global demand for air cargo, quantified in cargo tonne-kilometres (CTKs), witnessed an impressive 8.3% surge compared to November 2022. International operations were not far behind, with an 8.1% growth. The uptick in demand demonstrates the sector’s resilience.
Cargo Capacity
In tandem with rising demand, available cargo tonne-kilometres (ACTKs) experienced a commendable 13.7% increase in November 2023, outpacing the previous year by 11.6% in international operations.
Notably, the surge in capacity is primarily attributed to the escalating belly capacity as international passenger markets steadily recover from the throes of the pandemic.
A Comparative Lens: Post-COVID Evaluation
Comparing the current scenario to the pre-COVID era of November 2019, demand slightly dipped by 2.5%, while capacity surged by 4.1%.
This nuanced perspective underscores the sector’s ability to adapt and evolve in the face of unprecedented challenges.
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Key Indicators
Purchasing Managers Indexes (PMIs)
The manufacturing output and new export order PMIs, key indicators of global air cargo demand, maintained a delicate balance just below the 50-mark in November.
Small positive movements hinted at a deceleration in the economic slowdown, instilling confidence in the market’s upward trajectory.
Global Cross-Border Trade Reversal
October witnessed the third consecutive month of growth in global cross-border trade, signaling a reversal of its previous downward trend.
This positive momentum bodes well for the air cargo sector, aligning with the overall economic recovery.
Inflation Trends
In major advanced economies, inflation, as measured by the Consumer Price Index (CPI), showed signs of softening in November.
The United States, Japan, and the EU hovered around 3% year-on-year. Contrastingly, China experienced negative annual growth in its CPI for the second consecutive month.
Rising Air Cargo Yields
Air cargo yields, inclusive of surcharges, continued their upward trajectory with an impressive 8.9% surge since October.
This surge aligns with improving air cargo load factors, possibly fueled by the surge in e-commerce deliveries from China to western markets.
Insights from IATA’s Director General
Willie Walsh, IATA’s Director General, expressed optimism, stating, “November air cargo demand was up 8.3% on 2022—the strongest year-on-year growth in almost two years.”
“It is shaping up to be an encouraging year-end for air cargo despite the significant economic concerns that were present throughout 2023.”
Regional Performance Highlights
Asia-Pacific Takes the Lead
Asia-Pacific airlines witnessed a remarkable 13.8% increase in air cargo volumes in November 2023, surpassing the previous month’s growth.
The removal of COVID-19 restrictions led to a substantial 29.6% surge in available capacity, underlining the region’s robust recovery.
North America’s Steady Climb
Despite a modest 1.8% increase in cargo volumes in November, North American carriers exhibited a significant improvement from October’s contraction. With a 4.0% growth in capacity, the region is on a steady upward trajectory.
Europe’s Resilience
European carriers demonstrated a resilient performance with a 6.7% increase in air cargo volumes, surpassing October’s growth. The 6.5% rise in capacity further solidifies the region’s rebound.
Middle East Soars High
Middle Eastern carriers stole the spotlight with a robust 13.5% year-on-year increase in cargo volumes in November.
A 15.4% surge in capacity further cements the region’s dominance in the air cargo landscape.
Latin America and Africa Hold Steady
Latin American carriers maintained consistency with a 4.2% increase in cargo volumes, mirroring October’s performance.
Meanwhile, African airlines witnessed a slight improvement at 3.9%, with capacity soaring by 14.0% compared to November 2022.
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