New export orders, leading indicator of cargo demand, now shrinking in all markets except US, says IATA
The global demand for air cargo dropped 5.2% in March year-on-year as the omicron variant of the coronavirus and the Russia-Ukraine war contributed to the decline, the International Air Transport Association (IATA) said on Tuesday.
While capacity was in positive territory with 1.2% above March 2021, it saw a significant decline from the 11.2% year-on-year increase in February, with Asia and Europe experiencing the largest decreases.
New export orders, a leading indicator of cargo demand, are now shrinking in all markets except the US, the IATA said, adding, the purchasing managers’ index (PMI) indicator tracking global new export orders fell to 48.2 in March, the lowest since July 2020.
“Air cargo markets mirror global economic developments. In March,the trading environment took a turn for the worse,” said Willie Walsh, IATA’s director general.
The combination of war in Ukraine and the spread of the omicron variant in Asia have led to rising energy costs, exacerbated supply chain disruptions, and fed inflationary pressure, he added.
“Compared to a year ago, there are fewer goods being shipped – including by air. Peace in Ukraine and a shift in China’s COVID-19 policy would do much to ease the industry’s headwinds,” he said. “As neither appears likely in the short-term, we can expect growing challenges for air cargo just as passenger markets are accelerating their recovery.”