The air cargo market is currently “far healthier” than the passenger sector and carriers in the Middle East are performing better than most other regions, according to new data from the International Air Transport Association (IATA).
Middle Eastern carriers reported a decline in air cargo demand of 19% year-on-year in June, an improvement from the 25% fall in May. The June figure is a slightly bigger decline than the global average of 18% but international capacity in the Middle East region decreased by 26%, the best of all regions.
In comparison, European carriers experienced a 41% decline in international capacity while those in Africa experienced a 46% drop.
IATA said the Middle East’s relatively strong capacity was primarily driven by “the aggressive operational strategies” of some of the region’s carriers.
In general, global air freight markets in June showed some improvement, but at a slower pace than some of the traditional leading indicators would suggest.
Global capacity shrank by 34% in June compared to the previous year. Belly capacity for international air cargo shrank by 70% in June compared to the previous year due to the withdrawal of passenger services amid Covid-19. This was partially offset by a 32% increase in capacity through expanded use of freighter aircraft.
“While economic activity is re-starting after major lockdown disruptions there has not been a major boost in demand,” said Alexandre de Juniac, IATA's CEO.
“The rush to get personal protective equipment (PPE) to market has subsided as supply chains regularised, enabling shippers to use cheaper sea and rail options. And the capacity crunch continues because passenger operations are recovering very slowly.”
Even aircraft manufacturers have benefitted from a comparatively healthy air freight market with good long-term prospects. While Boeing has been struggling for commercial jet orders this year, it recently received two orders for freighter aircraft.
DHL Express has ordered four Boeing 767-300 freighters and Aircraft Finance Germany (AFG) signed an agreement with Boeing for two 737-800 freighters. Both companies are responding to strong near and long-term express cargo demand.
"With a burgeoning e-commerce sector and the continued lack of belly space in passenger aircraft, there could not be a more opportune time to add these freighters to the DHL Express air network," said Sean Wall, executive VP, network operations and aviation, DHL Express Asia Pacific.
Boeing has ramped up production in response to increased demand for its 737-800 freighter, which currently has so far won 132 orders.