Omicron is concerned about a reduction in global air freight demand as a result of the Russia-Ukraine conflict

Omicron is concerned about a reduction in global air freight demand as a result of the Russia-Ukraine conflict

The effects of Omicron in Asia, the Russia-Ukraine war and a challenging operating backdrop contributed to the decline. Global demand, measured in cargo tonne-kilometres (CTKs*), fell 5.2 per cent compared to March 2021 (-5.4 per cent for international operations). “Global demand, measured in cargo tonne-kilometres (CTKs), fell 5.2 per cent compared to March 2021 (-5.4 per cent for international operations). Capacity was 1.2 per cent above March 2021 (+2.6 per cent for international operations).

The International Air Transport Association (IATA) reported a drop in global air cargo markets in March, owing to COVID variant Omicron’s dominance in Asia and the Russia-Ukraine conflict, which is creating a difficult operating backdrop. “Because several airlines operating in Russia and Ukraine were significant cargo operators, the war in Ukraine resulted in a reduction in cargo capacity utilised to serve Europe. Manufacturing was disrupted as a result of Russia’s sanctions. Moreover, rising oil prices have a negative economic impact, including increased shipping costs “According to IATA.

While this is in positive territory, it is a significant decline from the 11.2 per cent year-on-year increase in February. Asia and Europe experienced the largest falls in capacity,” IATA data read. Global commodity trade continues to decline in 2022, with China’s economy growing more slowly due to COVID-19 related lockdowns (among other factors); And the disruption in the supply chain was exacerbated by the war in Ukraine. General consumer price inflation for the G7 countries in February 2022 was 6.3 per cent on a year-on-year basis, the highest since 1982.

“Air cargo markets mirror global economic developments. In March, the trading environment took a turn for the worse. The combination of war in Ukraine and the spread of the Omicron variant in Asia have led to rising energy costs, exacerbated supply chain disruptions, and fed inflationary pressure. As a result, compared to a year ago, there are fewer goods being shipped–including by air,” said Willie Walsh, IATA’s Director-General.

“Peace in Ukraine and a shift in China’s COVID-19 policy would do much to ease the industry’s headwinds. As neither appears likely in the short-term, we can expect growing challenges for air cargo just as passenger markets are accelerating their recovery,” he added.

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