Air freight volumes drop 4% globally
- Data for May 2021 showed a less favorable trend, with lower demand being accompanied by a second consecutive month-over-month decline in “dynamic load factor” and air freight rates.
June 05, 2021: Persistent market uncertainties and extended public holidays contributed to a 4% drop in global air freight demand in May 2021 from pre-Covid level in 2019, according to the latest volume analysis, of load factor and industry tariffs by CLIVE Data Services and TAC index.
CLIVE Data Services continues to focus on comparing the current state of the market with pre-Covid 2019 volume, cargo capacity and load factor data, through at least the third quarter of this year. This is carried out in parallel with the 2020 comparison.
After more positive indicators for the air freight market in the first four months of the year, data for May 2021 showed a less favorable trend, with the drop in demand accompanied by a second consecutive drop in month to month of “dynamic load factor” and air freight. rates, which peaked in early May, fell towards the end of the month.
The global air cargo industry will now have to wait for the release of market data for June 2021 to determine whether the May holiday disruption explains the change in demand or whether April’s positivity of 1% growth compared to in the same month of 2019 created a “false dawn”. ‘a sustainable recovery in growth for the rest of the year.
“There were several public holidays in May that were not present in May 2019 (China, Russia and Eid al-Fitr at the end of Ramadan) which will have negatively impacted the monthly growth rate. How much is hard to say – so May 2021 is more complex to qualify than to quantify. Monthly data leaves us with a question mark that will likely go unanswered until we see June’s level of demand. There are signals in the May data that may be of concern – particularly the 9% drop in air freight volumes outside of Europe compared to May 2019 – but it is certainly far too early to tell if we are seeing a change. structural in the recovery of the last few quarters. Nonetheless, there are several indicators in May indicating that the growth path may be slowing, ”said Niall van de Wouw, CEO of CLIVE Data Services.
CLIVE’s ‘dynamic load factor’ for the month of May of 69% – based on the outlook analysis of freight volume and weight carried and available capacity – was 7 percentage points higher than in 2019, although that this also presented declines of 2 points and -4%. points compared to April and March 2021.
Available capacity in May 2021 was down 21% from May 2019 level. This shows that the airline capacity gap is widening again compared to pre-pandemic market conditions after the figure of -18% in April and -14% for March.
Data for May 2021 compared to the same month of 2020, when Covid restrictions caused serious disruption in the global aviation market, shows 41% growth in taxable weight, 42% increase in capacity available and a 1% increase in dynamic load factor.
The TAC Index says the higher rates in May are in line with load factors that are still high due to capacity shrinkage in the market, but it has also seen prices decline on major trade routes in recent weeks.
“Air cargo capacity is still scarce on many key trade routes, so prices remain high as economic activity picks up while passenger air capacity remains limited due to restrictions on international travel. The BAI (Baltic Air Freight Indices) rose 3% in May compared to April, but this is a marked slowdown from the 17% growth seen between April and March, ”added Gareth Sinclair of TAC Index. “Price strength continues to be seen from China and Hong Kong to the United States and Europe and from Europe to the United States, with all 3 trade lanes seeing price increases in May through compared to April, although prices peaked in early May and have fallen in recent weeks. Even so, the air freight market continues to be strong, particularly from CN / HK to the United States, and is expected to continue for for some time, as demand in many markets continues to exceed supply as e-commerce traffic increases and economic activity strengthens in many markets. “
Prices from the United States to Europe were down in May from April levels, although they began to rise in the last two weeks of the month after an almost continuous decline since late March, according to the TAC index. Comparison of average price levels from May 2021 to May 2019 shows the relative strength of the 4 trade lanes with the EU-US leading with 173%, followed by CN / HK-US at 151%, and CN / HK -EU and US-EU growth at more modest levels of 84 percent and 64 percent, respectively.