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The Air Cargo Market Fell 7%, Indicating That The Summer Will Be Uncertain:

airport cargo services

The air freight tracking industry continues to lose altitude in the face of an overall economic slowdown and supply chain disruptions. It is unclear whether rapidly changing conditions will allow airlines cargo operations to return to positive territory this summer.

According to the air intelligence branch of freight rate benchmarking and analytics business, demand for air cargo tracking services was also 8% lower in May 2019 than before the epidemic. Meanwhile, available capacity grew 4% from the previous year, but it is still 12% below what it was in 2019. As a result of the shift in supply and demand, aircraft utilization declined significantly, with the average load factor dropping 9 points to 60%.

Reduced competition for shipping space resulted in decreased costs, but they are still high compared to historical averages. In May, rates were still 16 percent higher than in 2021 and 134 percent higher than in 2019, although they were around 10 points lower than in April.

Today’s market has seen some of the most significant changes, with passenger airlines quickly reintroducing passenger services for the summer season in response to fewer travel restrictions and robust bookings. The rapid expansion of widebody aircraft that can transport people and cargo has resulted in a significant increase in capacity in a short time. May capacity was 82% higher than in 2021, up from 44% in March.

Load factors trade route has dropped to 64% from 82 percent in March over the last eight weeks. The dynamic load factor, the amount of cubic capacity occupied by freight, was also 22 points lower in May than a year ago, compared to only 7 points in March. It will be fascinating to witness how rates shift in the coming months in the market. It could be a bellwether for how other markets will develop when flight capacity returns to its former level.

Consumer spending declines, a shift in expenditure to services, and reduced export orders may result in a weaker peak shipping season and lower air cargo demand this fall than many had anticipated. Another potential, according to logistics experts, is a significant demand boost in the normally slower summer months as where China reopens from its stringent lockdown period as delayed factory production is released into the market. Many air cargo tracking company expect a boost in demand as businesses scramble to make up for a missed time in bringing goods to market.

More business could come their way to influence contract discussions with marine companies. The current International Longshore and Warehouse Union agreement ends on July 1, and little movement has been reported thus far. Shippers have already relocated some goods to other ports to minimize potential delays, and more cargo air freight may be converted to air as the best target approach.