Air freight demand continues to decline in July

Air cargo at an airport (Photo: ACI)

Data provider Xeneta said that in July, air freight demand fell 9% year-on-year and dynamic load factor - taking into account both weight and volume - fell 8 percentage points on last year to 58%.

Air freight demand decreased by 9% in July 2022 (Source: CLIVE Data Services)

In July, rates were up 11% year-over-year - and 121% higher than July 2019 - but CLIVE has shown that the gap from pre-Covid-19 has continued to narrow.

Xeneta's director of airfreight Niall van de Wouw said the drop in demand came as the industry was hit by multitude of disruptions beyond its control, such as the war in Ukraine and the cost of living crisis is increasingly affecting the budgets of households.

Meanwhile, airlines and airports continue to face "severe operational challenges due to significant shortages of ground staffs".

“There are many dark clouds hanging over the air cargo industry given the state of the world right now,” said Van de Wouw.

“Volumes are subdued, and while air cargo rates are still elevated, they are slowly but surely easing back towards pre-Covid levels.”

“From a rates point of view, indicators suggest the market has yet to bottom out.”

"It’s clear that airlines are following the market very closely to ensure they are deploying their assets in the best possible way because the market is moving quickly."

"We have already seen freighters moving away from transatlantic routes."

Van de Wouw points out that prices in January were up 156% from pre-Covid 2019 levels to highlight the shrinking of freight rates compared to pre-Covid levels.

The drop in rates is particularly felt on the transatlantic service, where they are currently below the level of the previous year.

Air freight rates for the Atlantic route decreased in July 2022 (Source: CLIVE Data Services)

“On the Atlantic, the decline in general airfreight rates we reported for the previous three months of 2022 continued in July,” he added.

“While this will be partly seasonal,  the slight increase in load factor across the Atlantic relative to June – from 58% to 61% – might be a result of carriers and forwarders redirecting their freighter operations to other lanes, hence pushing up the load factor for the remaining flights on these routes,” he said.

In June, the demand for air freight fell 7% year-on-year according to CLIVE statistics.

Read more:

• Maersk Air Cargo prepares for Asia-US test flight
• Air freight demand decreased in March but freight rates remained high
• Air freight rates remain high as many challenges

Source: Phaata.com (According to AirCargoNews)

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