Since the beginning of 2020, when the pandemic brought international travel to a standstill, cargo flown in the “bellies” of passenger aircrafts has been struggling to return to their pre-pandemic levels. However, with COVID lockdowns being lifted and more and more people getting vaccinated, the demand for international passenger travel has skyrocketed and “belly” cargo has risen to 28 percent of the global total, up from just 4 percent in March of 2020.
“With all the uncertainty that these turbulent times and transformational developments bring in their wake, we still expect global passenger travel to return to the 2019 level of activity in 2024 and to expand substantially over the next two decades,” The International Air Transport Association (IATA) noted at their association’s annual general meeting, held this week in Qatar.
The steady recovery of belly capacity is good news for shippers who have had to pay higher rates for freighters for the last two years. Prior to the pandemic, belly capacity was a key segment of the global air cargo network, making up 51 percent of all available space.
The Trans-Atlantic trade lane was the first route to see available belly capacity come back into the market, as carriers have brought on summer schedules and have operated a large number of passenger flights. The newly available capacity between Europe and North America has brought about a nearly 70 percent drop in rates compared to this year’s high in April.
There will however be a large price to pay for the aviation industry, as the survival of many airlines was a direct result of massive financial support from the US government. IATA estimates that the support the airlines received could be as much as $100 billion, most of which is debt-based and will need to be paid back.
IATA has given a generally sunny outlook for commercial aviation, as the association has forecasted that the worldwide trade volume would increase by 3 percent and is expected to carry record 68 million tonnes of cargo this year.
IATA also predicts cargo revenue will reach $191 billion this year, which is nearly double the $100 billion achieved in 2019. The air cargo shares of total airline revenue rose from 11.4 percent in 2016 to 40.3 percent in 2021.
Willie Walsh, director general of IATA, recently said “Air cargo stood out as a lifeline for vaccines, supply chains, and airline revenues throughout the COVID-19 crisis, and it has grown to be an even more vital contributor to revenues,”.
Whether your cargo flies in the sky or moves on the water, ClearFreight stands ready to help you make sure your cargo gets to its destination in a timely and cost-effective manner. Contact our team today to hear how decades of experience and our customizable supply chain solutions can help make logistics easier for you.