IATA says 2020 worst year for air cargo demand since 1990

• African airlines saw demand grow by 1 percent in 2020 compared to 2019 and a fall in capacity of 17.3 percent.
• African airlines now have the same share of the global international cargo market as carriers from Latin America.

February 04, 2021: The International Air Transport Association (IATA) released data for global air freight markets showing that demand for air cargo decreased by 10.6 percent in 2020, compared to 2019. This was the largest drop in year-on-year demand since IATA started to monitor cargo performance in 1990, outpacing the 6 percent fall in global trade in goods.

African airlines saw demand grow by 1 percent in 2020 compared to 2019 (1.9 percent for international operations) and a fall in capacity of 17.3 percent (-15.8 percent for international operations). African airlines posted the strongest international growth of all regions in 2020 as well as in December. International demand in the month grew by 6.3 percent year-on-year. African airlines now have the same share of the global international cargo market as carriers from Latin America (2.4 percent). International capacity decreased by 21.6 percent in December, a steepening of the 18.6 percent fall in November.

Global demand in 2020, measured in cargo tonne-kilometres (CTKs), was 10.6 percent below 2019 levels (-11.8 percent for international operations).

Global capacity, measured in available cargo tonne-kilometers (ACTKs), shrank by 23.3 percent in 2020 (‑24.1 percent for international operations) compared to 2019. This was more than double the contraction in demand.

Due to the lack of available capacity, cargo load factors rose 7.7 percent in 2020. This contributed to increased yields and revenues, providing support to airlines and some long-haul passenger services in the face of collapsed passenger revenues.

Improvements towards yearend were demonstrated in December when global demand was 0.5% below previous-year levels (-2.3 percent for international operations). Global capacity was 17.7 percent below previous-year levels (‑20.6 percent for international operations). That is much deeper than the contraction in demand, indicating the continuing and severe capacity crunch. With the stalling of the recovery in passenger markets, there is no end in sight for the capacity crunch.

Economic conditions are picking in 2021. The new export orders component of the manufacturing Purchasing Managers’ Index (PMI) is in growth territory in both developed and emerging markets. And global industrial production has also recovered.

“Air cargo is surviving the crisis in better shape than the passenger side of the business. For many airlines, 2020 saw air cargo become a vital source of revenues, despite weakened demand. But with much of the passenger fleet grounded, meeting demand without belly capacity continues to be an enormous challenge. And, as countries strengthen travel restrictions in the face of new coronavirus variants, it is difficult to see improvements in passenger demand or the capacity crunch. 2021 will be another tough year,” said Alexandre de Juniac, IATA’s director general and CEO.

Strong variations were evident in the regional performance of air cargo in 2020. North American and African carriers reported an annual gain in demand in 2020 (+1.1 percent and +1 percent, respectively), while all other regions remained in negative territory compared to 2019. International demand fell in all regions with the exception of Africa which posted a 1.9 percent increase in 2020 compared to the previous year.

Asia-Pacific airlines reported a decline in demand of 15.2 percent in 2020 compared to 2019 (-13.2 percent for international operations) and a fall in capacity of 27.4 percent (-26.2 percent for international operations). In December airlines in the region posted a 3.9 percent decrease in international demand compared to the previous year. After a pause in recovery in Q3, demand is improving, driven by a rebound in manufacturing activity and export orders from China and South Korea. International capacity remained constrained in December, down 25.1 percent.

North American carriers posted a 1.1 percent increase in demand in 2020 compared to 2019 (-5.2 percent for international operations) and a fall in capacity of 15.9 percent (-19.7 percent for international operations). In December carriers in the region posted an increase of 3.1 percent in international demand. This was the strongest monthly performance since late 2018. Strong traffic on the Asia-North America routes, which was up 2.1 percent in 2020, contributed to the performance, driven by strong demand from North American consumers for goods manufactured in Asia. Capacity remained constrained, down 14.1 percent in December.

European carriers reported a 16 percent drop in demand in 2020 compared to 2019 (-16.2 percent for international operations) and a fall in capacity of 27.1 percent (-27.1 percent for international operations). In December airlines posted a decrease in international demand of 5.6 percent compared to the previous year. After a pause in recovery in November, seasonally adjusted demand grew 7 percent month-on-month in December, the largest rise of all regions. However, new lockdowns and adverse economic conditions in the region risk the recovery. Lack of capacity remains a challenge, as international capacity decreased 19.4 percent in December.

Middle Eastern carriers reported a decline in demand of 9.5 percent in 2020 compared to 2019 (-9.5 percent for international operations) and a fall in capacity of 20.9 percent (-20.6 percent for international operations). After a slight slowdown in recovery in November, carriers in the region performed well in December, posting a 2.3 percent increase in international demand. International capacity decreased by 18.2 percent in December, unchanged from November.