The air cargo industry stands as a crucial pillar of global trade and economic development, with its indispensable role in sustaining international supply chains. Following the Covid pandemic, the air cargo market has undergone a correction, with key indicators such as yields, capacity growth, and the freighter-to-bellyhold cargo split normalising following the record-breaking highs of 2021.
Despite this normalisation, demand for airfreight remains high in 2024 compared to 2023, with total demand rising by 13.6 percent. Freight demand is expected to continue to grow and double by 2025. The rapid growth in global trade, expansion of e-commerce, demographic expansion and growing consumer demand for expedited delivery services together with capacity constraints on maritime shipping continue to fuel the sector’s growth.
The air cargo industry stands as a crucial pillar of global trade and economic development. Throughout the pandemic, it played an indispensable role in sustaining international supply chains. However, as we return to a more stable global economy, the airfreight sector faces new challenges. The market is undergoing a significant correction, with key metrics like yields, capacity growth, and the belly-dedicated freighter split normalising after the record- breaking peak of 2021. As air cargo returns to pre-pandemic trends and levels, stakeholders must adapt to these shifts to remain competitive.
According to IATA, global air cargo volumes are expected to reach 62 million tonnes in 2024. However, revenue is forecasted to drop to US$120 billion, a result of capacity recalibration and pricing adjustments with the recovery of passenger travel. This ongoing stabilisation presents an opportunity for industry players to rethink their strategies, with operational efficiency becoming a critical factor for success.
Latin America: A growing hub
One region showing exceptional growth in the airfreight market is Latin America. In 2023, the region experienced a remarkable 28 percent increase in air traffic, driven by major carriers like Aeromexico, Avianca, and LATAM Airlines Group. According to IATA, Latin America’s load factor increased by 2.1 percentage points to reach 84.7 percent, the highest among all global regions.
Unlike other parts of the world, Latin America relies heavily on air transport due its geography and vast distances. Airport infrastructure is crucial to supporting this growth. However, many key airports, such as Mexico City and Bogotá, are already operating at capacity, requiring more than 10 days’ advance booking for cargo. To address this, US$94 billion in infrastructure investment is needed by 2040, according to estimates by ACI World and Oxford Economics. In addition to infrastructure, recent developments, such as the multilateral agreement on air cargo liberalisation between several Latin American nations, will further facilitate trade by creating a more efficient and open environment for airfreight. FIATA, from its global standpoint, is eager to address these global and local market developments at the upcoming FIATA World Congress, which will be held in Latin America this year in Panama City, Panama. Latin America’s air cargo market continues to show strong growth, proving its role as a key player in global trade. In July 2024, the region experienced an impressive 11.1 percent increase in air cargo demand, underscoring a robust appetite for airfreight services. Given Latin America’s geographic and logistical characteristics air transport a critical mode of cargo movement due to long distances and challenging terrain.
FIATA’s role
Freight forwarders play a pivotal role in the air cargo logistics industry. Many are small and medium- sized enterprises (SMEs) and are vital contributors to driving operational efficiency due to their flexibility, regional expertise, personalised service, and cost-efficiency. These forwarders help foster healthy competition and enhance the resilience and responsiveness of the air cargo supply chain, making them indispensable partners in the global airfreight ecosystem. In collaboration with global partners, FIATA is leading initiatives in digitalisation, sustainability, safety, security, and training to ensure its members remain well-equipped to navigate the rapidly changing airfreight environment.
One of the key areas we focus on is safety and security and regulatory compliance. The airfreight industry must be prepared to meet more stringent regulations, especially as more governments introduce Pre-Loading Advance Cargo Information (PLACI) initiatives worldwide to mitigate safety and security threats.
FIATA is also raising awareness to ensure global compliance with Dangerous Goods Regulations (DGR) requirements. These efforts are vital as we continue to advocate for higher safety standards in airfreight operations. To support this, FIATA offers the ICAO-FIATA Dangerous Goods by Air Training Programme through authorised training centres. This accessible training provides a practical solution for SMEs in the freight forwarding industry to obtain DGR certification worldwide.
Join the conversation
To further explore air cargo trends and challenges and chart the course for the future of logistics, we invite you to join us at the 2024 FIATA World Congress, scheduled for September 23-27, 2024, in Panama City, Panama. This year’s congress is a must-attend event for anyone involved in logistics and freight forwarding.
The event features the dedicated panel “Propelling airfreight growth through operational efficiency”, where experts from across the airfreight sector will discuss strategies for overcoming current challenges and leveraging new opportunities. The panel will feature speakers like José Machado Frías from Emergent Cold LatAm, Fabio Rahnemay Rabbani from ICAO’s South American Regional Office, and Kerstin Strauss from Kuehne + Nagel, moderated by Barbara Hiebendahl from ECX Global Logistics. More speakers to be revealed soon.
Register now to be an actor of the future of air cargo and discover about the latest industry trends!
