The ongoing Middle East conflict, coupled with the usual post–Lunar New Year trade slowdown, significantly impacted air cargo demand and capacity in March, leading to a year-on-year decline.
Data released by IATA revealed that total demand, measured in cargo tonne-kilometers (CTK), saw a 4.8% decrease compared to the previous year’s March levels. Similarly, capacity, measured in available cargo tonne-kilometers (ACTK), also fell by 4.7% year-on-year. Despite these reductions, the cargo load factor (CLF) managed to hold steady at 47.9%.
Earlier in the month, Xeneta had reported a 3% year-on-year drop in global air cargo demand for March, with capacity supply registering a 6% decrease over the same period.
“Industry-wide cargo-tonne-kilometers declined by 4.8% year-on-year, reflecting one of the most complex operating environments in recent years,” commented the trade body. They further elaborated that “March was shaped by overlapping Chinese New Year distortions, escalating geopolitical instability in the Middle East, and higher fuel costs, all of which disrupted established traffic patterns.”
Jet fuel prices surged by 106.6% year-on-year, reaching their highest point in over 23 years. This dramatic increase contributed to an 18.9% rise in “cargo yields in a distinctly inflationary pricing environment,” IATA noted.
Willie Walsh, IATA’s Director General, reflected on the situation: “Air cargo demand fell 4.8% in March compared to the previous year. This was mostly due to severe disruptions at major Gulf hubs due to war in the Middle East.” He added, “The timing of the usual post–Lunar New Year slowdown also added to the decline. The underlying demand trends, at this point, appear strong and the recent World Trade Organization and International Monetary Fund revisions to trade and GDP projections continue to see growth in 2026.”
Walsh emphasized the resilience of the sector, stating, “Importantly, air cargo networks are providing the flexibility needed to support global supply chains as they adjust to geopolitical, tariff, and operational strains. All eyes are on fuel supply and price, which are expected to test the industry’s resilience in the coming months.”
Despite the immediate challenges, general trade conditions presented a more positive outlook. Global industrial production expanded by 3.1% year-on-year in February, marking its 38th consecutive month of growth, and global goods trade increased by 8%. Global manufacturing sentiment remained in growth territory in March, with the Purchasing Managers’ Index (PMI) at 51.4, easing slightly from February. The PMI for new export orders also stood at 50.1, both figures being above the 50-point expansion threshold, signaling favorable conditions for air cargo demand, according to IATA.
Regional performance among airlines showed clear divergences. Middle Eastern carriers experienced the most significant impact, with a substantial 54.3% year-on-year decrease in air cargo demand in March, marking the weakest performance across all regions. Their capacity also saw a sharp decline of 52.4%. In contrast, most other regions reported increases in demand, with the exception of North America.
Africa led the growth, with its airlines reporting a 7% increase in demand, despite a 4.6% decrease in capacity. Asia Pacific airlines saw demand rise by 5.4% and capacity by 5%. European carriers recorded a 2.2% demand increase and a 4.2% capacity increase. Latin American and Caribbean carriers also noted a 1.8% demand increase, with capacity growing by 5.1%. However, North American carriers faced a 1.2% decrease in demand and a 1.1% decrease in capacity.
Air cargo performance varied across major trade lanes in March. The Africa-Asia route led growth, followed by Asia–Europe, with intra-Asia trade also maintaining strong performance. Conversely, Gulf-linked corridors were severely disrupted due to the ongoing conflict in the Middle East.
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