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On the back of growth in global trade, especially the booming e-commerce, and continuing capacity constraints on maritime shipping, international cargo market is showing strong growth in 2024 again. According to IATA’s figures, demand for air freight rose by 11.4% in August, representing the ninth consecutive month of double-digit year-on-year growth, with overall levels reaching heights not seen since the record peaks of 2021. Just one month later, IATA’s figures shows that air freight rose again by 9.4% in September, representing the 14th consecutive month of growth.

According to Cirium’s tracked utilization data, in terms of tracked number of departing freighter aircraft, tracked aircraft number has increased by 32% globally between the first 10 months of 2024, over the same period of 2019.

For the top 10 ranking air freight markets, China’s growth leads the way with 85% growth, followed by United Arab Emirates at 48% and Hong Kong SAR at 45%. as shown in the below chart. The United States is still the largest air freight market with growth of 28%. The United Kingdom is the only country that has declined at -2% in the top 10 list.  

China as the global manufacturing centre, benefits hugely from the surge in e-commerce demand given the country’s dominating position in global trade and export, which therefore has led to the booming of its air freight sector. However, China’s current dedicated cargo fleet especially the widebody fleet seems to be lagging the pace in which international trade demand has been grown and appeared to be not matching the country’s status as a global manufacturing centre.

Various comments have gone around in the market recently, about that there are plenty of widebody freighter requests in Asia, especially in China/Hong Kong.

The logistics companies are eager to get more space, but the operators cannot offer enough capacity which has consequently driven up shipping prices.

To understand the magnitude of Chinese carriers’ freighter capacity supply shortfall towards the above mentioned situation, number of tracked outbound freighter aircraft from China by domestic carriers is assessed below, and is compared with number of tracked outbound freighter aircraft by foreign carriers from China.  

As shown in the above chart, number of tracked outbound freighter aircraft by domestic freight carriers has been more than doubled during the first 10 months of 2024, compared with the pre-pandemic level.

During this period, according to Cirium’s fleet data, China’s freighter fleet (including both narrowbody and widebody) has grown from just less than 160 aircraft in 2019 to around 230 in 2024, with widebody freighter fleet grown from less than 50 aircraft to around 90.

The growth of domestic freighter fleet seems to be fast but is such growth enough to fulfill the demand?

As shown in the below chart, when compared with the above chart, number of tracked outbound freighter aircraft from China by foreign freight carriers is 126% more than domestic freight carriers.

In addition, when compare with pre-pandemic level, number of tracked outbound freighter aircraft from China by foreign freight carriers has grown by 51% after the pandemic.

In the short term, the outlook for air cargo market is positive, with businesses replenishing inventories in preparation for the year-end festive season. In the longer term, if China can withhold its position as the global manufacturing centre as well as sustaining the robust development momentum of its e-commerce sector, despite the challenges it also faces with ongoing geopolitical tensions with other countries and regions which may impact China’s export and international trading, the country will need to further expand its domestic freighter fleet power especially in the widebody category as a means to compete with foreign operators for dominance in the local market.

Nevertheless, persistent OEM delays and supply chain disruptions continue to pose challenges to carriers in acquiring either new freighters or converted freighters.

This requires domestic carriers to have a long-term strategic vision in terms of anticipating future growth needs, and decisively place orders with OEMs to lock in earlier future delivery slots before OEMs’ slots are filled by orders from other carriers.

Chinese carriers currently have around 10 remaining orders for the current generation 777 freighters, but no orders have been placed yet for the new A350F and 777-8F. The latter two types have a combined orderbook of well over 100 aircraft to date, and deliveries are expected to only begin after 2026 and 2028 respectively.

Cirium Ascend Consultancy’s recent webinar on the freighter market is available to view on demand. WATCH NOW.

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