Air cargo market suffers lowest rates in May since March 2020

Tension is mounting in the global air cargo market heading into the weaker summer months with general airfreight rates falling in May to their lowest level since March 2020 as restless airlines and freight forwarders went in search of volumes, indicates the latest weekly market analysis by CLIVE Data Services, part of Xeneta.

The global airfreight spot rate fell 40% in May from a year earlier, reaching its lowest level in over three years of USD 2.41 per kg, just days after IATA predicted airline cargo revenues and yields could fall by more than 31% and 29% respectively in 2023.

Softening global air cargo demand saw a less severe year-over-year drop of -1% in chargeable weight in May, the smallest monthly decline in the past 12 months, but the influx of belly capacity for the peak summer leisure travel market applied more downward pressure on rates. Global air cargo capacity in May continued its double-digit increase, up 14% year-on-year.

Less demand and more capacity led to an inevitable fall in dynamic loadfactor, CLIVE’s measurement of global volume and weight perspectives of cargo flown and capacity available. It was -5% pts lower vs. May 2022 at 55%.

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