The global air cargo market is edging towards a sustainable recovery at the start of the traditional peak season, says analysts Clive Data Services and TAC Index.
It attributes the growth to a “record dynamic loadfactor” and high air freight rates on the world’s premier trade lanes in September.
Chargeable weight in September rose 9 percentage points month-on-month, further narrowing the year-on-year gap to -15 per cent, the fifth consecutive month of positive indicators since April 2020’s 37 per cent decline in volumes versus the same month of 2019.
Niall van de Wouw, Clive Data Services’ managing director said: “A fifth consecutive month of gradual air cargo market improvements may not be sensational news but, in this case, sometimes boring is good.
In fact, our latest weekly analyses reveal more positivity than I would have expected based on the global impact of government actions to restrain the spread of Covid-19. The air cargo market seems to be quite resilient. In April, Clive stated that the industry’s downward performance was ‘bottoming out’ and this has proven to be correct, with month-over-month improvements ever since.
“While this might be encouraging news for airlines, it means shippers and forwarders are being faced with higher airfreight costs. Uncertainty over how the market will develop alongside very high load factors is a toxic combination for the buyers of airfreight capacity. If this demand persists, and shippers are prepared to pay, we may well see a resurgence in passenger planes being deployed mainly or solely for moving freight. These remain uncertain times but with more optimism in the market for October and November volumes, the question is: how far can the recovery go?”
Clive Data Services ‘dynamic loadfactor’ – based on both the volume and weight perspectives of cargo flown and capacity available – averaged 70 per cent in September, a 2 percentage point increase vs August 2020 and 8 percentage points higher year-over-year.
Notably, the 71 per cent figure for the week of Sep 28-Oct 4 was the highest ever recorded by Clive.
Global air cargo capacity in September was, on average, 25 per cent less than in the same month of last year.
Constrained capacity in the market at a time of rising demand also led to significant increases in rates, according to the TAC Index. “It is interesting to see how closely demand/volume and pricing correlate in light of the fact there are a lot less BSAs (Block Space Agreements) in place currently. There were steady increases in pricing week-over-week in September, with rates on lanes from China/Hong Kong to the EU in the last week of September 8% higher than in the last week of August,” commented TAC Index’s business development director, Robert Frei.
Latest Clive Data Service and TAC Index analyses of the ‘dynamic loadfactor’ and air freight rates on trans-Atlantic routes reported even higher gains. The elevated load factor for westbound volumes rose to 84 per cent in September – up 18 percentage points versus September 2019 – while the eastbound ‘dynamic loadfactor’ was 67 percent. Corresponding westbound and eastbound airfreight rates rose 170 per cent and 73 per cent respectively over the same period of last year.
