All regions are expected to experience air cargo growth in 2024, according to IATA. The Middle East is set for the biggest rise at 12.3% while Africa will see a more modest 1.5% growth. On average, air cargo is forecast to grow 4.5%.
“Yields will likely decline in 2024 but they will still be above their 2019 levels,” says Rachel Yuting Fan, IATA Sustainability and Economics. “Cargo revenue will also be about 11% above 2019 and comprise 12% of total industry revenue. In other words, 2024 will see sustained revenue growth and the sector outperform pre-pandemic levels.”
The relevant economic markers are also positive with 3.5% growth in global trade projected for 2024. Broadly, belly capacity is back and will carry the majority of air cargo while preighters have disappeared entirely. Dedicated freighters will maintain their usual share of the market.
Other beneficial factors include the continued growth of e-commerce, the reduction in delivery times, and the robust performance of high-value specialized products, such as pharmaceuticals, which seem resilient to the industry’s usual volatility.
Possible downsides include China’s supply chain and currency fluctuations.
Overall:
Cargo revenues are expected to fall to $111 billion in 2024.
Yields will remain high by historical standards, despite falling in 2023 and 2024. Yield progression has been extraordinary in recent years (-8.2% in 2019, +54.7% in 2020, +25.9% in 2021, +7% in 2022, -32.2% in 2023 ).
Cargo volumes are expected to reach 61 million tonnes in 2024.
Addressing challenges
Digitalization and sustainability will continue to be critical to air cargo’s progress.
Digitalization must overcome 50-year-old legacy systems and embrace a true data-sharing environment rather than just digitize paper documents. The problem is the varied data in air cargo, which covers different functions, stakeholders, and formats. This makes any streamlining attempts extremely complex.
“ONE Record will help,” says Henk Mulder, IATA’s Head, Digital Cargo. “It is an open standard that will connect the data and will be vital to digitalization success. It has been tested and validated by over 200 companies for reliability and efficiency and all airlines must implement ONE Record by 1 January 2026.”
With ONE Record in place, there will be a unified approach to structuring air cargo data, which in turn will facilitate consistency in information exchange. Importantly, this seamless data sharing will utilize advanced encryption and security protocols to protect sensitive information.
The implementation of Preloading Advance Cargo Information (PLACI) will also be a notable milestone. The objective is increased cargo security, but PLACI is a complex undertaking and governments are not harmonizing their efforts. Unaligned PLACI programs make data sharing more difficult and run the risk of slowing down cargo flows.
Digitalization will give air cargo not only the ability to serve e-commerce growth and smooth capacity fluctuations but also provide the analytics to boost sustainability.
Several elements of sustainability—aside from carbon emission reduction—are at play in air cargo, including:
* Eliminating single use plastics
* Lowering the loss of perishables
* Advocating for sustainable facilities
* Attracting and retaining young talent.
Source: https://airlines.iata.org/2024/01/04/air-cargo-set-positive-2024
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