New York — Air passenger numbers are set to have weakened by almost 61% in 2020 on the year to 1.8 billion, the International Air Transport Association said in a statement Nov. 24.
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This is level with the number the industry carried in 2003, the association added.
However, passenger numbers are expected to grow again in 2021 to around 2.8 billion, it said.
Along with this, the industry can expect a net loss of $118.5 billion in 2020 and a net loss of $38.7 billion in 2021, IATA said.
In the cargo segment, uplift in 2020 is expected to be 54.2 million mt, down from 61.3 million mt in 2019.
In 2021, the role that air cargo will play in vaccine distribution should bolster the sector and volume should grow to some 61.2 million mt, essentially matching 2019's number of 61.3 million mt, IATA said.
"2020 cargo revenues are bucking the trend, increasing to $117.7 billion in 2020 from $102.4 billion in 2019. A 45% fall in overall capacity, driven largely by the precipitous fall in passenger demand which took out critical belly capacity for cargo (-24%), pushed yields up by 30% in 2020," IATA said.
Since news of potential COVID-19 vaccines broke, the paper jet fuel market has started to price in this expectation of increased demand toward the latter half of 2021. Contango in the market has deepened accordingly.
The front-month versus month-six spread on the CIF NWE jet fuel swap was assessed at a one-month low of minus $15.25/mt on Nov. 20 and continued to trade around that level on Nov. 24.
The prompt market remains relatively weak, with the front-month contract trading at only $10/mt.
Recently, there has been support from supply-side tightness and storage demand, despite weak end-user demand.
"Global aviation trends had been flat but have taken a noted decline in the last three weeks since Oct. 25," analysts at S&P Global Platts Analytics said.
European airline travel has been declining since the end of August, but the degree of deterioration has accelerated in the week ending Nov. 15.
"November global jet-kero demand is expected to rise slightly vs.Oct, but the recent downturn is creating a headwind moving forward, though we forecast an increase in Dec. demand," the analysts said.