In a notable display of resilience, the global air cargo market continued its growth trajectory for the third consecutive year in October, posting a 3.8% year-on-year (YoY) increase in Cargo Tonne-Kilometers (CTKs). Despite the ongoing challenges posed by the pandemic, the industry’s performance is a positive signal, closing the year with better-than-expected results.
Positive Trends in Cargo Demand and Capacity
The demand for air cargo, measured through CTKs, reached 21.9 billion in October, marking a 3.8% YoY increase. Seasonally adjusted CTKs grew by 4.5%, indicating a steady upward trend. This sustained growth since August highlights the ongoing recovery of the global air cargo market, and the industry is poised to close the year on a positive note.
Air cargo capacity, measured by Available Cargo Tonne-Kilometers (ACTKs), showed an impressive YoY increase of 13.1% in October. This surge in capacity is primarily attributed to the robust return of international passenger belly capacity, which saw a substantial 30.5% annual growth. Overall, industry ACTKs surpassed 2019 levels by 2.8%, showcasing a strong rebound.
Global Trade and Economic Landscape
October saw the stabilization of global trade, with a reversal of the previous downward trajectory. While not yet reaching the heights achieved in 2022, global trade displayed growth for the second consecutive month, outpacing the recovery in industrial production. Both global cross-border trade and industrial output have exceeded pre-pandemic levels by over 5%, signaling a positive trend.
However, economic activities slowed down in October, as reflected in significant contractions within the manufacturing sector and export activities. The Purchasing Managers’ Index (PMIs) for manufacturing output declined from 49.8 in September to 48.9 in October. Similarly, the new export orders PMI dropped from 47.7 to 45.5, indicating a notable decrease in global demand for exports.
Impact of Jet Fuel Prices on Air Cargo Yields
A critical factor influencing the aviation industry is the global oil price, which directly affects airline operating costs. In October, jet fuel prices declined by 7.8% from September, closing the month at USD 120.8 per barrel on average. This decline in fuel prices is a positive development for airlines, contributing to a 2.5% increase in air cargo yields (including surcharges) from September.
Africa
African airlines saw their air cargo volumes increase by 2.9% (an improvement on September’s -0.1% performance). they also benefitted from the strongest annual growth since May (+16.7%) with capacity 9.8% above October 2022 levels
