Air cargo demand to remain even with return of Red Sea shipping

IATA does not expect to lower its air cargo demand forecast when ocean shipping eventually returns to the Red Sea, according to an article in Air Cargo News.

This makes interesting reading for the U-Freight Group with our global air freight forwarding and logistics services, and our e-commerce logistics operations.

The trade body confirmed in its Sustainability and Economic Outlook during the Plenary Session of its World Cargo Symposium that it expected a 6 per cent growth in air cargo volumes in 2025.

Air Cargo News reported that IATA director general Willie Walsh said that the trade body believes the air cargo industry can well withstand the return of ocean shipping to the Red Sea, even though the prospect of such a return does seem a long way off.

Reflecting on the impact on air cargo, Mr Walsh said: “I don’t think it will be significant. This is because of the core demand from time-sensitive markets that airfreight serves.

“What we tend to transport by air is critical in terms of time or critical in terms of value. And those goods tend to stick with air rather than move to transport by ship, so just-in-time products will invariably move by air.”

IATA predicted in December that air cargo volumes, measured in cargo tonne-kilometres (CTK), would rise by 5.8 per cent year on year to reach 72.5 million tonnes in 2025, supported by e-commerce and Red Sea-related demand.

And following the beginning of the Red Sea crisis and the rerouting of ships around the Cape of Good Hope in Africa, a number of companies have reported additional airfreight or sea-air demand from shippers that would traditionally use ocean shipping services.

But when the recent ceasefire between Israel and Hamas was announced – leading Hamas supporting Houthi rebels to cease attacks on commercial shipping in the Red Sea – there was debate in the industry about how quickly ships would return to the Red Sea and whether airfreight would suffer as a result of shippers switching back to their normal transport mode.

Some suggested that the effort required from shipping lines and shippers to re-adjust to the Red Sea/Suez Canal route meant they would want long-term certainty that attacks would not restart.

And the ceasefire has since ended, a blow to hopes of a return to the Suez Canal for commercial shipping.

Any shift from air back to sea “is very marginal”, according to Mr Walsh. In fact, volumes are less significant than yields in the scenario that disrupted ocean freight goods shifts to airfreight because it has become time critical.

To read the Air Cargo News article, go to the following website:

https://www.aircargonews.net/iata-wcs/air-cargo-shouldnt-fear-eventual-return-of-red-sea-shipping/1079993.article

For more information about the U-Freight Group’s global air freight forwarding and logistics services, or our e-commerce logistics operations, please visit the relevant pages of this website or contact your local office, details of which can be seen here: https://ufreight.com/locations