Air cargo: demand is accelerating, supply is contracting

Global demand for air cargo increased by 4.4% in August 2026 year-on-year, while supply declined slightly. However, the surge in kerosene prices is putting airlines' profit margins under pressure.

1/ Supply and demand

* CTK: cargo tonne-kilometres - Data source: IATA.

• Demand

Global demand for air cargo, expressed in cargo tonne-kilometres, has increased by 4.4% year-on-year, and 5.3% on international connections alone. Growth is accelerating compared to July (+3.9%) and is benefiting airlines in all geographical areas. However, it concerns essentially North American and Asia-Pacific companies, which alone generate 72% of the increase in global traffic according to IATA. North American companies, in particular, show the strongest growth internationally (+10.1%).

• Supply

Capacity, measured in available cargo tonne-kilometres, declined by 0.1% overall compared to August 2025, and increased by only 0.1% for international operations. This contraction is explained by the reduction in capacity operated by European (-3.5%) and North American (-2.5%) companies. This corresponds to a cumulative withdrawal of approximately 756 million available tonne-kilometres. The occupancy rate thus gained 2 points overall to reach 46%, and 2.6 points internationally (51.3%).

• Annual total

Year-to-date at the end of August, global air cargo traffic showed growth of 4.6%, with supply increasing by 1.5%. Only Middle Eastern companies, directly affected by the war in the Persian Gulf, showed a decline (-6.5%): the erosion of traffic suffered between March and June has not yet been compensated by the results of January, February, July and August.

* CTK: cargo tonne-kilometres - Data source: IATA.

2/ Development by corridor

• Asia-North America: the world's largest corridor was once again the main source of growth with a 13.2% increase in August, a marked acceleration. It thus shows "7 consecutive months of progress and 4 months of double-digit growth", IATA points out. Flows related to artificial intelligence infrastructure continue to support volumes destined for the United States. According to WorldACD, tonnages from China and Hong Kong to the United States increased by 13% year-on-year in August (+15% from mainland China, +9% from Hong Kong), a pace that was nevertheless slower than in May and June (+19% and +20%).
• Asia-Europe: The second busiest route in the world, the Asia-Europe corridor, saw a 3.1% increase in traffic in August, measured in tonne-km, the same rate as in July, representing a 42nd consecutive month of increase. However, growth remains significantly lower than in the first half of the year. "This slowdown coincides with the entry into force, on the 1st of July 2026, of the new European legislation on small parcels", says IATA. A flat customs duty of €3 per item now applies to parcels worth less than €150 from third countries, which has slowed cross-border e-commerce flows. According to WorldACD, tonnages from China and Hong Kong to Europe fell by 14% year-on-year in both July and August, whereas they were stable in June. The decline reached 30% from Hong Kong, which is heavily dependent on e-commerce, compared to 5% from mainland China. However, the decline appears to have bottomed out.
• Intra-Asia: Traffic increased by approximately 6% in August, a stable pace compared to July, still supported by flows related to the development of artificial intelligence.
• Transatlantic: On this route, traffic increased by 4.3% year-on-year in August, registering its strongest growth in 17 months.
• Middle East: The region continues to suffer from the conflict in the Persian Gulf, with a decline of 15.1% on the Europe/Middle East axis and 14.6% on the Middle East/Asia corridor. These declines were more pronounced compared to July, and are part of a series of six consecutive months of decline.

3/ Price trends

In August, the average price of Brent stood at $90.8/barrel, up 8.9% on July and 33.1% year-on-year, amid persistent supply disruptions in the Persian Gulf. Tensions in refining amplified the shock: the global price of kerosene reached $157/barrel, up 8.3% in a month and 79.2% year-on-year, its highest level for an August in 13 years. This increase is reflected in fuel surcharges, and consequently in cargo rates. According to IATA, the average air cargo yield increased by 1.3% month-on-month, ending three months of decline, and by 24.9% year-on-year.

Data from WorldACD confirms the high price level. In August, global average rates, spot and contracts combined, were 22% higher than those of August 2025, compared to +24% in July, +33% in June and +37% in May. On the corridors monitored by Upply, cargo rates remained generally stable in August compared to July, with variations ranging from -2.2% (Europe/Middle East) to +3.5% (Europe/North America, East Coast).

4/ Trends and outlook

• Air transport demand

Demand remained positive. In August, the global manufacturing PMI (production) reached 53.0, and the index of new export orders gained 1.4 points to 51.4: both indicators therefore remained in expansion territory. Global merchandise trade volumes, meanwhile, showed a 6% year-on-year increase in July, according to the CPB World Trade Monitor. In September, shippers also accelerated their shipments in anticipation of China's Golden Week (October 1-7, 2026).

Over the course of 2026, the conflict in the Middle East weighed on trade, but the rise in investments in artificial intelligence prevailed. In its October update, the World Trade Organization (WTO) significantly raised its forecast for global merchandise trade growth in volume, to +3.9% in 2026 compared to +1.9% forecast in March, after +4.2% in 2025. It forecasts +4.1% in 2027. AI-related goods (semiconductors, data centre equipment, etc.) accounted for 47% of the growth in global merchandise trade by value in the first half of 2026. This scenario, however, assumes a swift resolution to the conflict in the Middle East: a further escalation could put downward pressure on energy prices, while a slowdown in AI investment would have a significant impact on trade.

• Air transport supply

After a sharp decline in May and June, kerosene prices have started to rise again. So far, airlines have been quite successful in passing on these increases through the fuel surcharge mechanism, and in maintaining high cargo rates. This is also due to their prudent management of capacity, as evidenced by the decline in supply from European and North American companies in August.

The pressure is not easing: kerosene prices reached their highest level in six months in September. Further increases in fuel surcharges are therefore to be expected, just as the high season begins.

Airlines have so far managed to limit the impact of rising costs, although their margins remain under pressure. The evolution of demand will be a crucial point in the weeks and months to come. Inflation has indeed risen sharply again in Western economies (3.8% year-on-year in September in the Eurozone, 3.4% in August in the United States), which could weigh on household consumption and business investment. The bulk of growth today relies on the "AI engine".