News / Strong Q4 and booming ecommerce drives 'record peak season' for air cargo

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A “very strong Q4” for air cargo will likely turn into a record peak season, according to IATA economist Ghislaine Lang, but the growth will be hard to sustain next year.  

In yesterday’s IATA global cargo media day, Ms Lang noted that “with booming ecommerce and repeated disruptions in maritime shipping, the tide started to turn somewhere around mid-2023, and demand started to grow again,” after industry-wide air cargo demand contracted in post-Covid 2022.

And despite high expectations that this year’s peak season would be let down by an “unexceptional” October spike, “the truth will lie in November and December data”, she said. 

“We are experiencing a very strong Q4, and it’s likely going to turn into a record peak season after all,” added Ms Lang, who said IATA’s Q3 24 data had noted nine months of double-digit year-on-year growth. 

And in line with the “much better than initially expected demand”, IATA has doubled its annual CTK (cargo tonne km) growth forecast for 2024, to a “remarkable” 11.8%, delivering an “all-time high in air cargo demand”. 

However, Ms Lang noted that the year-on-year growth rates had been off the back of “an overall weak 2023 market”.  

“So, sustaining these double annual growth rates is going to become just a little bit harder as we are nearing the year-end,” she warned. 

And, looking to 2025, IATA predicted a “somewhat lower” growth pace for air cargo,, at about 6%.  

Air cargo capacity is also set to hit a record this year, as airlines continue to expand their fleets – “although at a slightly slower pace than in 2023”. 

IATA forecasts 9.6% capacity growth by the end of 2024, and 6.4% growth in 2025. 

Further, “against all expectations late last year” that air cargo yield would normalise and revert to its 2019 level, “that ended up coming to a halt in 2024”.  

IATA’s latest available data shows that, despite ongoing capacity growth, global yield for air cargo was roughly 50% above its 2019 level. It grew by an “impressive” 11% year on year in October, the third month in a row showing double-digit growth. 

And “there is no sign of the average yield reverting back to its pre-pandemic level”. 

Ms Lang explained that this could partly be attributed to the fact that large ecommerce companies, as well as shippers that had shifted from ocean shipping to air or sea-air transport, “are competing for tight capacity with the existing air cargo clientele”.

She said: “This puts upward pressure on yields and, as a result, we are seeing a slight upward trend in the global yield.” But she added: “There is plenty of regional variability behind that.” 

This high yield has primarily come from the rates on westbound routes out of Asia and the Middle East to Europe and the Americas “which have increased massively over the past year”. 

But many other major tradelanes, including respective backhaul routes and the transatlantic, are seeing lower rates than last year.  

“On a global level, we therefore revised our prediction for the yield upward, forecasting a smaller-than-expected decline of 3.5% for the full year 2024 and an almost flat evolution for 2025,” Ms Lang concluded. 

Despite this, yields are still expected to remain about one-third above pre-pandemic levels through to the end of 2025.