International Air Transport Association (IATA) officials project air cargo will serve as a critical bridge for global supply chains as tariffs reshape trade routes in 2026. Brendan Sullivan, IATA Global Head of Cargo, outlined how escalating trade tensions and fragmented markets are forcing companies to rely more heavily on air transport for speed and flexibility.
The United States average tariff rate reached approximately 17 percent in 2025 according to Yale Budget Lab analysis, marking the highest level since the 1930s. These trade barriers prompted major shifts in global commerce with Chinese exports to the United States declining 15.4 percent between January and August 2025 while exports to India surged 22.9 percent and Thailand grew 21.9 percent during the same period. Air cargo demand reached a record high in October 2025 growing 4.1 percent compared to the previous year, marking the eighth consecutive month of expansion according to IATA data.
Sullivan said companies now face last minute supplier changes and rerouting to avoid tariff heavy markets. Air cargo becomes the mode that can adapt fastest when trade flows are disrupted or rerouted, making agility essential rather than optional in the fragmented environment. The industry moved 180,000 tonnes of goods daily this year while accounting for 24.8 percent of global trade value despite handling less than one percent of trade by weight.
Trade patterns shifted dramatically throughout 2025 with air cargo enabling rapid adjustment of flows. Air transport saw growth rates exceeding 20 percent during peak months while sea freight experienced slower expansion, demonstrating the industry’s ability to respond quickly to policy changes. The Far East to Europe traffic corridor more than offset weakness between Far East and North America routes according to monthly statistics.
Sullivan emphasized that slot allocation remains a critical challenge as cargo carriers struggle to obtain historic or permanent airport slots unlike passenger airlines. Major hubs including Bogota, Dubai, Heathrow and Gatwick restrict cargo operators to temporary arrangements. Some airports impose shorter parking limits, curfews and separation windows while others maintain outright bans at locations such as Mexico City and Mumbai. The IATA Worldwide Airport Slot Guidelines (WASG) calls for fair and non discriminatory allocation regardless of operation type.
The industry projects global cargo traffic will stabilize at 2.6 percent growth in 2026 following 11.4 percent expansion in 2024. African carriers led regional performance with 16.6 percent growth in October 2025 while Asia Pacific carriers recorded 8.3 percent increases. North America and Latin America both contracted 2.7 percent reflecting uneven recovery across regions.
IATA identifies digitalization as essential for improving industry agility through the ONE Record standard. Nearly 50 percent of cargo industry participants indicated readiness for the data sharing platform scheduled for implementation on January 1, 2026. The standard establishes a single digital language for cargo data exchange reducing reliance on paper based processes that create inefficiencies and delays.
Sullivan stated that current cargo security regimes require modernization following incidents involving improvised incendiary devices in 2024. Inconsistent implementation of Consignment Security Declarations (CSD) creates gaps and duplication across jurisdictions. Less than 50 percent of surveyed countries accepted electronic CSD in 2022 according to industry data. Initial regulatory responses to security threats surpassed existing messaging standards technical capabilities, reaching the absolute limit of current systems.
Air cargo accounts for $204 billion in annual revenue supporting jobs worldwide while enabling e commerce growth of approximately 10 percent per year. High value goods and pharmaceuticals require rapid delivery while the middle class continues expanding despite slower growth than pre pandemic levels. The industry delivered over 3,500 tons of relief supplies from more than 90 countries following devastating earthquakes in Turkey and Syria demonstrating its humanitarian role.
Julia Seiermann, Head of Industry Analysis at IATA, noted that air cargo moves more sharply with trade fluctuations than other transport modes. The sector repeatedly shows its ability to adapt quickly when trade routes or sourcing patterns change, positioning it as uniquely suited to provide the agility modern supply chains require in volatile environments.
