Air cargo volume drops in 2022

MANILA, Philippines — The volume of air cargo in the Philippines declined both for domestic and international exchanges in 2022, suffering the same fate as the global trend as spiking inflation and tightening supply weighed down on demand.

According to the Civil Aeronautics Board (CAB), international air cargo flow slid by nine percent to 364.24 million kilograms last year, from 400.35 million kgs in 2021, with all segments posting a contraction.

Broken down, direct shipment and breakbuilding delivery dipped by 12 percent to 63.92 million kgs and 140.87 million kgs, respectively, while consolidations dropped by five percent to 159.44 million kgs.

Similarly, domestic air cargo volume decreased by 18 percent to 49.15 million kgs in 2022, from 59.68 million kgs in 2021. By segment, direct shipment slipped by five percent to 27.98 million, while consolidations crashed by 30 percent to 21.04 million kgs.

CAB reported, however, that breakbuilding delivery managed to grow seven-fold to 131,248.5 kgs on an annual basis. The decline in air cargo flow in the country reflected what the International Air Transport Association (IATA) is warning about.

IATA projects the air cargo industry to perform above its pre-pandemic levels this year, but said it will be pressured by rising prices and shortening supply of goods.

“Although the air cargo industry will continue to face macroeconomic headwinds this year, IATA expects air cargo yield and revenue to remain high and above those of 2019 levels,” IATA said.

For 2022, IATA said international air cargo flow fell below eight percent of the 2021 record and 1.6 percent short of the 2019 level, attributing the decline to multiple economic challenges.

For one, inflation tightened the pockets of families, compelling them to cut their spending. In the Philippines, inflation jumped to an average of 5.8 percent in 2022, from just 3.9 percent in 2021, as the government struggled to weather the price spikes across basic commodities.

On a regional scale, Asia and the Pacific has yet to return to its stable footing in terms of factory output, especially as most of East Asia stayed under lockdowns for too long. IATA said the region will suffer a drop in export orders with its supply chain disrupted.

In 2022, Nippon Express Philippines Corp. facilitated a cargo weight of 56.98 million kgs, or 16 percent of the market, to lead all international airfreight forwarders in the country.

On the other hand, AP Cargo Logistics Network Corp. airlifted 14.43 million kgs, or 29 percent of the market, to stay ahead of the domestic competition.