Air cargo and passenger airlines using older fuel-guzzling long-range freighters could pull out of the air cargo market this year as they battle falling yields and persistently high fuel costs, according to industry observers. They said this could remove capacity and help balance supply and demand growth, which would support yields for major airlines in the air freight market. Nick Rhodes, Cathay Pacific Cargo Director, said carriers operating older Boeing 747s on long-haul routes will find it extremely difficult to make a positive return in the current climate, even if the aircraft are fully depreciated. Rhodes said Cathay Pacific had already scrapped one of its six 747-400s that was converted from a passenger to a freighter aircraft. Four cargo aircraft have been parked as the airline reduces freighter capacity and prepares for the arrival of more Boeing 747-8 freighters and the launch of its 777-200 freighter services. Air China Cargo, Cathay’s joint venture with Air China, is rumored to be the recipient of some of the 777 freighters to replace 747-400 converted freighters as it seeks to stem losses. The International Air Transport Association (IATA) estimated that fuel accounted for 33% of an airline’s operating expenses last year compared with just 14% in 2003.