Global air cargo demand hits March record amid tariff changes: IATA

The operating environment in March 2025 reflected several notable trends. Cargo volumes typically increase following February's seasonal lull, and this year’s single-digit rise aligns with pre-COVID growth patterns. Jet fuel prices declined by 17.3 per cent YoY, marking the ninth consecutive month of such decreases, IATA said in its report.

The sharp increase in US tariffs and new trade regulations, including the May 2 ban on duty-free imports from China and Hong Kong, likely spurred early purchases to avoid higher import costs. The global industrial production grew by 3.2 per cent YoY, while trade volumes rose by 2.9 per cent.

The inflation rates showed a downward trend, with the US consumer price index (CPI) falling to 2.4 per cent (down 0.4 points from February), the EU CPI at 2.5 per cent, and Japan’s rate easing by 0.1 points to 3.6 per cent. Although China remained in deflation, the rate moderated slightly to -0.1 per cent.

Asia-Pacific airlines saw 9.6 per cent YoY demand growth for air cargo in March, the strongest growth among the regions. Capacity increased by 11.3 per cent YoY. North American carriers saw a 9.5 per cent YoY increase in demand growth for air cargo in March, and its capacity increased by 6.1 per cent YoY.

European carriers saw a 4.5 per cent YoY increase in demand growth for air cargo in March. Capacity increased 2.0 per cent YoY. Meanwhile, Middle Eastern carriers saw a negative 3.2 per cent YoY decrease in demand growth for air cargo in March. Capacity increased by 0.8 per cent YoY. It’s possible the weakness in this market is due to YoY comparison with the strong growth at the start of 2024 resulting from disruption to Red Sea maritime freight, added the report.

Latin American carriers saw 5.8 per cent YoY demand growth for air cargo in March. Capacity increased 4.7 per cent year-on-year. African airlines saw a -13.4 per cent YoY decrease in demand for air cargo in March, the slowest among the regions. Capacity increased by 10.5 per cent YoY.

In March 2025, the Europe–North America route emerged as the busiest trade lane, reflecting robust cargo movement across the Atlantic. The Asia–North America route, which holds the largest market share, also recorded strong growth—likely driven by front-loading of shipments in anticipation of potential tariff hikes. In contrast, the Europe–Middle East and Africa–Asia trade lanes were the only ones to register a decline during the month.

“March cargo volumes were strong. It is possible that this is partly a front-loading of demand as some businesses tried to beat the well-telegraphed 2 April tariff announcement by the Trump Administration. The uncertainty over how much of the 2 April proposals will be implemented may eventually weigh on trade,” said Willie Walsh, director general, IATA. “In the meantime, the lower fuel costs—which are also a result of the same uncertainty—are a short-term positive factor for air cargo. And, within the temporary pause on implementation we hope that political leaders will be able to shift trade tensions to reliable agreements that can restore confidence in global supply chains.”

ALCHEMPro News Desk (SG)