The International Air Transport Association has lowered its projection for air cargo volume expansion in 2026, citing widespread disruptions tied to the Middle East conflict during the first half of the year. According to the organization’s newest financial outlook for the global airline sector, freight volumes are anticipated to hit 71.7 million tonnes in 2026, a year-on-year rise of just 0.2%.

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This stands in sharp contrast to the 2.6% growth rate IATA had forecast at its World Cargo Symposium in March. In that same month, shortly after the outbreak of the Middle East conflict, air cargo demand—measured in cargo tonne kilometers—dropped 4.8% compared with the prior year. The following month, demand climbed 4% year on year. Over the initial four months of 2026, cargo volumes in cargo tonne kilometer terms increased 3.6% relative to the same period in 2025.

Despite the weaker demand forecast, cargo revenue is projected to reach $162 billion in 2026, up 7.2% from $151 billion in 2025. IATA attributed this revenue growth mainly to airlines recovering higher expenses stemming from the fuel price shock. Cargo yields are also expected to rise 6.5% this year, reversing three consecutive years of decline.

The closure of the Strait of Hormuz at the start of March disrupted global jet fuel supplies, prompting some carriers to adjust fuel surcharges upward, thereby increasing costs throughout the air cargo industry. Jet fuel costs remain a significant concern; overall fuel expenses are forecast to jump nearly 40%, from $252 billion in 2025 to $350 billion in 2026. IATA noted that while some of these added costs are being offset through price adjustments and efficiency gains, these measures will not be enough to sustain profitability at last year’s level. Total airline profits are expected to fall from $45 billion in 2025 to $23 billion in 2026.

Regional outlook

IATA characterized the regional cargo outlook as highly varied. Disruptions at Middle Eastern hubs have opened up new opportunities for Asia-based carriers to capture cargo traffic, especially on Europe–Asia trade lanes. However, regulatory shifts in Europe—such as stricter customs rules for low-value shipments—could impact e-commerce volumes, according to IATA.

The organization indicated that while cargo growth is likely to slow, capacity constraints and rerouting effects should keep market conditions relatively tight. Cargo markets in Latin America may weaken, particularly in export-focused economies, though structural demand drivers remain intact, pointing to a gradual rather than abrupt adjustment. Middle Eastern cargo markets are also facing strain, as disruptions have cut effective capacity and prompted a shift of transit cargo traffic to other regions, hurting financial performance. IATA stated that the near-term recovery will likely be driven more by pricing than by a swift rebound in volumes.

Source: IndexBox Market Intelligence Platform