Air cargo demand saw a slight year-over-year contraction in February, the first such decline in demand since July 2023, according to the International Air Transport Association (IATA).
Total demand, measured in cargo tonne-kilometers (CTKs), declined by 0.1 percent compared to February 2024 levels. The total got a little bit of help last year as well, with annual comparisons affected by the extra day in the year-ago month due to the leap year.
After adjusting for seasonality, including the extra date, air cargo traffic would be 3 percent above the year prior. This is just under January’s demand growth rate of 3.2 percent. On a month-over-month basis, seasonality adjusted demand fell 0.6 percent from January.
“Much of this is explained by February 2024 being extraordinary—a leap year that was also boosted by Chinese New Year traffic, sea lane closures and a boom in e-commerce,” said Willie Walsh, IATA’s director general, in a statement. “Rising trade tensions are, of course, a concern for air cargo. With equity markets already showing their discomfort, we urge governments to focus on dialogue over tariffs.”
The IATA’s plea comes ahead of April 2, or “Liberation Day,” when President Donald Trump expects to impose a series of reciprocal tariffs on “all countries.” Trump has already slapped 20-percent additional duties on products coming out of China, the primary market for cargo shipped via air to the U.S.
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Those tariffs have partly resulted in a mad dash for U.S. shippers to bring in goods from China via the cheaper ocean freight alternative. Major U.S. container ports are expected to continue to see elevated inbound cargo volume through the spring, but air cargo traffic hasn’t mirrored the months-long uptick experienced by its sea-bound counterpart.
The air cargo industry peaked in October 2024 at 24.4 billion CTKs, according to the IATA, but has entered a phase of gradual deceleration. At the time, demand saw its 15th consecutive month of annual growth. Air cargo volumes typically crest during the winter months as goods are shipped into the U.S. ahead of and during the holiday season before subsequently cooling down.
Year to date, the air cargo market has thus remained tepid, with total demand growth of 1.5 percent. That increase is still well below the IATA’s 6 percent expected growth for CTKs throughout 2025.
Like data recently released from WorldACD, flights out of the Asia Pacific region are carrying the load for overall customer demand for air freight, push overall international CTK growth a modest 0.4 percent. That total is 3.5 percent when adjusted for leap year.
Asia Pacific carriers led the February numbers with a 5.1 percent year-over-year gain, though they still decelerated from 7.5 percent in the prior month. The trans-Pacific corridor remained the busiest trade lane in the world despite the China tariffs, representing 24.4 percent of all flights and ticking up 0.1 percent year over year for its 16th consecutive months of growth. The trans-Atlantic route between North America and Europe saw expanded demand of 4.5 percent.
Ceva Logistics is looking to capitalize on the trans-Pacific trade lane, introducing its own three times per week trans-Pacific charter this month. IAG Cargo, which handles cargo for British Airways, is expanding its upcoming summer schedule in the trans-Atlantic route, reinstating three times-weekly services from both Madrid and Barcelona to San Francisco. More will be added from Dublin to Denver, and London to Chicago, Vancouver and Washington, D.C.
There is still plenty of uncertainty for e-commerce giants like Shein, Temu and others aiming to ship goods out of China to the U.S., as the duty-free de minimis trade provision remains under fire from the Trump administration. If that exemption, which enables packages with goods valued at less than $800 to enter the U.S. tax free, gets the axe, rates and demand are likely to spiral even further.
Across all trade lanes, North American and European airlines reported their first year over year declines in February since late 2023, at 0.4 percent and 0.1 percent, respectively.
As for capacity, it declined 0.4 percent year over year to 43.5 billion ACTKs in February, according to the IATA. When adjusting for seasonality, capacity fell slightly compared to January, while remaining 3.3 percent above the level observed a year ago.
With overall demand declining, rates are falling as well. Global air cargo yields dropped by 6.1 percent month over month, reaching a 12-month low.