"The air cargo market has shown weakness for the past nine months, and the depressed demand that we are seeing across all markets gives us little reason to be optimistic about the near-term outlook," SIA Cargo president Tan Kai Ping said. - File photo

SINGAPORE: Singapore International Airlines (SIA) Cargo said on Wednesday it had reduced capacity by 20 per cent due to weakness in global demand and high fuel prices.

The cuts "were implemented recently and will continue into the Northern Summer operating season which starts late next month," SIA Cargo said in a statement.

It painted a bleak outlook for the market.

"The air cargo market has shown weakness for the past nine months, and the depressed demand that we are seeing across all markets gives us little reason to be optimistic about the near-term outlook," SIA Cargo president Tan Kai Ping said.

"With no improvement expected in the first half of this calendar year, and with stubbornly high fuel prices pushing up costs, we have taken appropriate action to reduce our freighter operations to better match capacity to demand."

SIA Cargo has a freighter fleet of 13 Boeing 747-400s. The capacity cuts were mainly for long-haul services.

Singapore's main trading partners include Europe, which is mired in a debt crisis, and the US, where a recovery from a severe recession is struggling to gain traction.

"SIA Cargo will continue to closely monitor market conditions and will stay nimble in aligning capacity deployment to demand," the statement said.

Parent firm SIA group said earlier this month that its third-quarter net profit tumbled 53 per cent from a year ago due to the impact of "persistently high" jet fuel prices.

Singapore's trade-reliant economy, which grew 4.9 per cent last year, is projected to expand at a slower 1 to 3 per cent this year due to weakness in its main trading partners, the government has said.-AFP

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