Global air cargo demand rose 4.4% year-on-year in August, while total capacity slipped 0.1% — a squeeze that pushed the industry-wide cargo load factor up two percentage points to 46%, according to the International Air Transport Association (IATA).

International operations grew faster than the market as a whole, with demand up 5.3% against August 2025, while international capacity inched up just 0.1%. The combination of firm volumes and shrinking belly and freighter supply handed carriers rare pricing leverage in a period of severe cost pressure.

Jet fuel prices rose 8.3% month-on-month in August and stood 79.2% higher than a year earlier, hammering airline cost bases. IATA's senior vice president for sustainability and chief economist, Marie Owens Thomsen, said "air cargo demand rose 4.4 per cent year-on-year in August with all regions reporting growth even as capacity was trimmed by 0.1 per cent", adding that "strong demand and higher load factors helped airlines to recoup some of the exceptionally high fuel costs".

She also noted that yields rose month-on-month for the first time since April, while global goods trade kept expanding. "Both are positive signs as the year-end peak season comes into view," Owens Thomsen said.

Trade tailwind, cost headwind

The operating environment remained supportive. Global trade grew 6% year-on-year in July, extending its run of annual growth to 33 consecutive months. Global manufacturing strengthened too: the Global Manufacturing Output PMI gained 0.3 points to 53, and the New Export Orders Index rose 1.4 points to 51.4.

For shippers and forwarders, the message is blunt: capacity discipline plus rising fuel surcharges and the first yield uptick since April point to firmer rates heading into the fourth-quarter peak. Carriers, particularly those holding widebody freighter capacity on the transpacific, are positioned to press that advantage.

North America leads, Middle East lags

North American carriers posted the strongest regional performance, with demand up 6.6% even as capacity fell 2.5%, lifting the region's load factor 3.6 points to 42%. Latin American and Caribbean airlines grew volumes 5.1% on 3.3% more capacity, with load factors up 0.6 points to 34.9%.

Asia-Pacific carriers — still the largest market at 35.8% of industry cargo tonne-kilometres in 2025, ahead of North America's 24.6% and Europe's 21.4% — saw demand rise 4.3% on 1.2% capacity growth, reaching a 48.6% load factor. European airlines grew demand 4.1% while cutting capacity 3.5%, producing the industry's highest load factor at 53%, up 3.9 points.

Africa expanded capacity 14% against 3% demand growth, dragging its load factor down 3.9 points to 36.5%. Middle Eastern carriers recorded the weakest demand growth at 1% on 3.3% more capacity, with load factors down one point to 43.1%. The Middle East held 13.2% of the 2025 market; Latin America and the Caribbean 2.9%; Africa 2.1%.

Trade lanes diverge sharply

The Asia–North America corridor, the industry's largest lane at 23.5% of cargo traffic, grew 13.2% — its seventh consecutive month of expansion. Intra-Asia traffic rose 6.1%, a 34-month growth streak, on a 7.3% traffic share. Europe–North America gained 4.3% for a fourth straight month (13.5% share), while Europe–Asia advanced 3.1% for a 42nd consecutive month of growth (21.5% share).

Gulf-linked routes told the opposite story, still disrupted by the conflict in the Middle East. Europe–Middle East demand fell 12.1%, a sixth straight month of contraction on a lane carrying 5.2% of industry traffic. Middle East–Asia dropped 11%, also a sixth consecutive monthly decline, on a 7.4% share. Africa–Asia demand fell 11.9% for a third successive month, though the lane represents just 1.3% of traffic.

The pattern leaves carriers with a clear choice: push widebody capacity toward the booming transpacific and intra-Asian networks while Gulf hubs — normally natural transit points between Europe and Asia — continue to shed volumes. For forwarders routing Gulf transit traffic, rerouting via European or Asian hubs is likely to remain the costlier but necessary norm.

With fuel costs up nearly 80% year-on-year, yields finally rising again and peak season approaching, carriers look set to defend load factor discipline through the fourth quarter — and shippers should budget for rate firmness rather than relief.