Global cargo performance data for March revealed a severe capacity shortfall as airlines continue to deal with the effects of the coronavirus pandemic. The International Air Transport Association (IATA) said Tuesday that global demand for air cargo fell by 15.2% in March compared to the year-earlier period, while capacity fell by nearly 23%.
International markets account for 87% of air cargo, IATA said, adding that belly capacity for international air cargo fell by nearly 44% during the month. Those figures were partially offset by a 6.2% increase in capacity through expanded use of freighter aircraft, including the use of idle passenger aircraft for all-cargo operations, the Geneva-based trade group also said.
IATA officials said governments need to act to fill the gap between demand and capacity as the need for supplies to fight the coronavirus continues. They pointed to a doubling of demand for pharmaceutical shipments critical to the crisis as one example.
“With most of the passenger fleet sitting idle, airlines are doing their best to meet demand by adding freighter services, including adapting passenger aircraft to all-cargo activity. But mounting these special operations continues to face bureaucratic hurdles. Governments must cut the red tape needed to approve special flights and ensure safe and efficient facilitation of crew,” Alexandre de Juniac, IATA’s director general and CEO, said in a statement.
Key issues airlines face include delays in getting charter permits issued, a lack of exemptions on Covid-19 testing for air cargo crew, and inadequate ground infrastructure to and from and within airport environments, IATA said.
Separately, industry researcher FTR Transportation Intelligence (FTR) said its Shippers Conditions Index for February ticked up considerably, reflecting a “sharply positive freight market” in the United States. The index registered 7.93 in February, up from 3.73 in January, FTR said Tuesday.
The increase ended three straight months of small declines, and researchers said they expect it to increase dramatically over the next few months in response to weak volumes and rates stemming from the Covid-19 crisis.
“The recent uptick in the Shippers Conditions Index is expected to continue for the next several months, but it does not necessarily mean it is a great time to be a shipper as it flows from the Covid-19-related disruptions,” Todd Tranausky, vice president of rail and intermodal at FTR, said. “The one positive for shippers out of the virus will be a much more positive environment for the balance of 2020 than was expected otherwise. It will take time for capacity and volume to right size and while it does, shippers should be able to obtain favorable terms to ship their goods.”