DEMAND is declining across air cargo markets, hindering load factors and rate levels, reports IHS Media.
Air cargo rates on east-west trade lanes have declined over the last few months, with the industry appearing to settle into a slow summer season after two years of record-highs.
Since 2022's highs in April, average air cargo spot rates on China-North America routes are down 23 per cent at US$8.23 per kilogramme, according to the Baltic Air Index (BAI).
On the China-North Europe trade, the rate is 30 per cent lower at $6.13/kg, while trans-Atlantic westbound rates are down 40 per cent at $5.72/kg.
'Demand this year is similar to pre-Covid-19, but the difference is that we are actually experiencing a normal seasonal summer slack period this year, as opposed to the relentless demand and capacity shortfalls of the previous two years,' said air cargo analyst WorldACD.
Association of Asia Pacific Airlines (PA) director general Subhas Menon declared data from regional carriers for July indicated a further weakening of air cargo markets.
'Prevailing supply chain disruptions, inflationary pressures, and geopolitical tensions further dampened demand for air shipments,' said Mr Menon.
Although passenger business improved, Mr Menon warned that challenges for Asian carriers included operational issues from manpower shortages, rising costs, and a slowdown in global economic growth.
It was highlighted in the WorldACD update, declaring the overall air cargo volume from Asia to the major market 'trend since April and into August is not a favourable one.'
The volume of North Asia air cargo exports in the first four months of 2022 was up three per cent compared with 2021, but the last three months were down five per cent.
Part of the decline in rate levels on major trades is attributed to the inability of the markets to match the exceptional volume out of North Asia last year.
Said Xeneta: 'The recent decline in freight rates is partly due to the falling dynamic load factor, which measures the flight capacity utilisation considering both freight volume and weight,'
'Airlines have clearly added more capacity as a part of their summer schedule than was needed in the market.'
SeaNews Turkey
Air cargo rates on east-west trade lanes have declined over the last few months, with the industry appearing to settle into a slow summer season after two years of record-highs.
Since 2022's highs in April, average air cargo spot rates on China-North America routes are down 23 per cent at US$8.23 per kilogramme, according to the Baltic Air Index (BAI).
On the China-North Europe trade, the rate is 30 per cent lower at $6.13/kg, while trans-Atlantic westbound rates are down 40 per cent at $5.72/kg.
'Demand this year is similar to pre-Covid-19, but the difference is that we are actually experiencing a normal seasonal summer slack period this year, as opposed to the relentless demand and capacity shortfalls of the previous two years,' said air cargo analyst WorldACD.
Association of Asia Pacific Airlines (PA) director general Subhas Menon declared data from regional carriers for July indicated a further weakening of air cargo markets.
'Prevailing supply chain disruptions, inflationary pressures, and geopolitical tensions further dampened demand for air shipments,' said Mr Menon.
Although passenger business improved, Mr Menon warned that challenges for Asian carriers included operational issues from manpower shortages, rising costs, and a slowdown in global economic growth.
It was highlighted in the WorldACD update, declaring the overall air cargo volume from Asia to the major market 'trend since April and into August is not a favourable one.'
The volume of North Asia air cargo exports in the first four months of 2022 was up three per cent compared with 2021, but the last three months were down five per cent.
Part of the decline in rate levels on major trades is attributed to the inability of the markets to match the exceptional volume out of North Asia last year.
Said Xeneta: 'The recent decline in freight rates is partly due to the falling dynamic load factor, which measures the flight capacity utilisation considering both freight volume and weight,'
'Airlines have clearly added more capacity as a part of their summer schedule than was needed in the market.'
SeaNews Turkey
