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Air cargo sees 6-month lowest fall in September

LONDON, October 27, 2020

The year-over-year (YoY) air cargo drop in kilograms worldwide during September was by far the lowest since April: -12.5% for the month against -33% for April, a report said.

 Month-over-month (MoM), September showed a 7% increase, whilst September 2019 was more or less the same as August 2019. Even yields/charges per kilogram seemed to “stabilize” around $2.82 (still more than 60% higher YoY, added the WorldACD Market Data report.
 
“We have noted that quite a bit of the Covid-related equipment is marked as general cargo. With the “second wave” growing over the past months, this may well be one of the reasons why general cargo was up by 8% (MoM) in September, and other product categories by only 4%,” the report said.

Transport of flowers increased by 7% MoM, but other perishables, vulnerable goods and pharmaceuticals by around 2% only. Thus, general cargo’s share of the total business showed a MoM increase from 65.5% to 66.5%.

 The origin regions Africa, Europe and MESA (Middle East & South Asia) had an above average MoM growth in September: +11%, +10% and +8% respectively. Airline revenues increased by 6% MoM, due to a USD-yield drop of 1%, remarkably evenly divided over all regions.

 Freighter capacity in September was the same as in August, but cargo capacity on passenger aircraft increased by 3%. Average load factors on the two aircraft types improved by 1%-point and 3%-points respectively. Cargo capacity on passenger aircraft grew strong on the lanes from Central & South America (+15%) and Asia Pacific (+10%).

The first two Covid-19 quarters revisited

The worldwide market decreased by 21% YoY in volume: the origins MESA, Africa and Europe suffered most (-37%, -30%, -28% respectively), and Asia Pacific least (-12%). Most areas suffered losses on all major trade lanes (i.e. region-to-region markets) in more or less equal measure. The exceptions were Asia Pacific and Central & South America (C&S Am). The former lost very little on the lanes to Europe and North America, whilst C&S Am only lost 7% on its lanes to the north.
 
Due to a very severe capacity shortage, airline cargo revenues increased with 42%. Yields/charges per kg increased by 81% from an average of $1.75 to $3.18. The largest YoY differences were recorded in yields/charges ex-MESA (+112%) and ex-Asia Pacific (+108%). Although on some of the smaller lanes, yields/charges did go up to levels between 8 $and 9.5 USD, on the larger lanes the average yield was nowhere near the incidental yields reported by some over the past months: Asia Pacific noted an average of $4.89 to Europe and of EUR 5.91 to North America.

 The differences in the dwindling demand for goods carried by air, is well illustrated when looking at the YoY changes in freight carried to each destination region: Europe lost 16%, but Africa 31%. The other destination areas showed losses between 21% and 26%.

 Airlines grouped by origin, suffered in equal measure when it comes to volume lost, but in very different ways when looking at their revenues: airlines from the Americas added 24% to their revenues, but those from MESA and Asia Pacific 60% resp. 52%.

The forwarders outside the world’s Top-30 indeed increased their worldwide share, from 54% to 55%, but they ‘bought’ that increase by accepting charges that were 85% higher YoY, whilst the Top-30 saw their charges increase by 76%.

In the largest market (i.e. ex-Asia Pacific) the Top-30 paid average charges that were 6% lower than those paid by the smaller forwarders (last year they were 12% higher). This is the more telling when taking into account that the Top-30 do much more in the markets to North America, where charges are highest.

Among the Top-30, the forwarders with headquarters in Asia Pacific and North America improved their volume share. Remarkably, the Asia Pacific forwarders managed to do so in spite of paying average charges 8% below the average for the total elite group. – TradeArabia News Service
 




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