On January 12, 2022, the International Air Transport Association (IATA, hereinafter referred to as "IATA") released its regular report on global air cargo, indicating a slowdown in global air cargo demand growth in November 2021. While the economy remains positive for the industry, supply chain disruptions and capacity constraints have impacted demand.Due to the impact of the COVID-19 epidemic, the year-on-year results of the monthly data for 2021 and 2020 are distorted.Unless otherwise noted, year-over-year results are compared to normal demand data for October 2019.

Air cargo demand
Global air cargo demand (measured in terms of freight tonne-kilometres or "CTKs") increased by 3.7% year-on-year in November 2019 (international demand up 4.2%), significantly lower than October 2021 (+ 8.2%, international demand up 9.2%) and previous months.

Air cargo capacity
Capacity was 7.6% lower than in November 2019 (international capacity down 7.9%) and unchanged from October.Key hubs continue to experience capacity bottlenecks.

The economy continues to boost air cargo, but supply chain disruptions are weighing on growth.The following factors should be noted:

1. Labor shortages, in part due to quarantined employees, a lack of storage space at some airports, and supply chain disruptions exacerbated by a centralized approach to handling backlog at the end of the year. Congestion was reported at several major airports, including New York's John F. Kennedy, Los Angeles and Amsterdam's Schiphol.

2. Retail sales in the US and China continue to be strong.

3. In October, the latest month for which data are available, global goods trade rose 4.6% from pre-crisis levels, the highest growth rate since June.Over the same period, global industrial production rose 2.9 per cent.

4. The inventory to sales ratio is still very low, which is favorable for air cargo, and manufacturers are turning to air cargo to meet demand quickly.

5. Demand for personal protective equipment (PPE), which is often flown in, has been strong recently as several developed economies experience another spike in COVID-19 infections.

6. The global supplier delivery Time Purchasing Managers' Index (PMI) was 36.4 in November.

While a value below 50 is generally positive for air freight, in current conditions delivery times are lengthening due to supply chain bottlenecks. Iata Director General WillieWalsh said: "Air cargo growth halved in November 2021 compared to October due to supply chain disruptions. All economic indicators point to continued strong demand, but growth opportunities have unexpectedly slowed due to labor shortages and bottlenecks throughout the logistics system. For example, manufacturers are unable to get vital goods to where they are needed, including personal protective equipment. Governments must act quickly to ease the strain on global supply chains before the pandemic causes permanent damage to economic recovery.

To mitigate disruptions to the air cargo supply chain, IATA calls on governments to:

1. Ensure that flight crew are not subject to the restrictions imposed on air passenger entry quarantine during the COVID-19 pandemic.

2. Implement the commitments made by governments at the ICAO High-Level Meeting on COVID-19 to restore international connectivity, including passenger travel.Increased significant freight capacity in the "belly" space.

3. Provide innovative policy incentives to address labor shortages.

4. Support the World Health Organization/International Labour Organization Action Group established to ensure freedom of movement for international transport workers.