Demand for air cargo has rebounded sharply since national lockdowns have eased with strong growth expected for the remainder of 2020, according to IATA.
Calling air cargo demand “one of the few bright spots” in the global airline sector, IATA chief economist Brian Pearce said during a press briefing today that requirements for air freight had been supported by the transport of medical equipment and essential supplies.
The decline in demand for air cargo over the summer was therefore shallower than for passenger services, while the bounce back has benefited from a fast rebound in economic confidence.
Unlike for passenger demand, air freight requirements are “following a fairly typical recession/recovery cycle”, Pearce says, something that has enabled air cargo to increase its share of world trade by value. “In the next couple of months, we are likely to see further improvements in air cargo traffic demand.”
Although total global air freight requirements were roughly 13% lower in July than a year earlier – because large amounts of belly freight space on passenger aircraft has been taken out of service – there is greater demand for the remaining cargo capacity. Before the crisis, roughly 50% of air cargo was carried on passenger aircraft.
This has resulted in a “real shortage of capacity, and in particular… a real shortage of freighter capacity”, says Pearce. “If we look at what is happening to the capacity side of the cargo business, the cargo fleet is being utilised probably as much as can be”. Even accounting for this, “cargo capacity is still between 30-40% down on where it was before [the pandemic].”
Of particular concern are long-haul operations, which are expected to be the last passenger services to return to normal, presenting a “serious constraint” to global freight flows.
Air freight rates have risen sharply as cargo capacity has fallen, helping to offset some of the lost passenger income for some carriers.
Highlighting that air freight will be required to transport a Covid-19 vaccine when it does become available, IATA is urging governments to begin planning now for its distribution. With even a single vaccine dose per person requiring a global air freight capacity of 8,000 Boeing 747s, constraints to air freight could have serious implications for a vaccine roll out.
“Safely delivering Covid-19 vaccines will be the mission of the century for the global air cargo industry. But it won’t happen without careful advance planning. And the time for that is now,” states IATA director general Alexandre de Juniac.
”We urge governments to take the lead in facilitating co-operation across the logistics chain so that the facilities, security arrangements and border processes are ready for the mammoth and complex task ahead.”