Air cargo volumes improve but uncertainty continues: WorldACD

Global tonnage improved three percent in week 15 (April 7-13) after the previous week’s drop of seven percent as markets that had closed for the Eid-al-Fitr holiday came back on stream.

"Comparison with last year’s developments for the holiday indicates that this constituted less than half of the decline in week 14, which suggests that demand has been further afflicted by uncertainty about the trade conflict triggered by the U.S. government," according to the latest update from WorldACD.

"The comparison of the last two weeks with the previous two weeks (2Wo2W) shows a worldwide decline of six percent in chargeable weight, down from a two percent 2Wo2W slip in week 14. However, year on year (YoY) tonnage was at +nine percent based on the last two weeks, up from an increase of seven percent in the previous report but this positive trend is caused by the Eid festival that took place in week 15 last year."

After the Eid holiday, volumes rebounded in double-digit percentages WoW out of Africa (+13 percent) and Middle East & South Asia (MESA, +12 percent) while tonnage increased four percent out of Asia Pacific and three percent out of Central and South America.

The upward momentum in worldwide pricing seen in recent weeks hit a wall, retreating from $2.50 in week 14 to $2.48 (-one percent), which slowed the 2Wo2W momentum from +three percent last week to +two percent, the update added. "The uncertainty over trade conditions has caused companies to postpone investment and sourcing decisions until there is more clarity and in some cases to cancel orders.Compared to a year ago, pricing in week 15 was still slightly up (+two percent)."

Asia Pacific exports under a cloud
Volumes to the U.S. fell three percent for a second week in a row, marking a third week of decline in this lane. "The deterioration in tonnages from China and Hong Kong worsened from a two percent decline in week 14 to a drop of -seven percent. Amid the escalating tension between China and the U.S., not to mention some order cancellations from Amazon and other U.S. firms with their Chinese suppliers, the outlook for a recovery in traffic is doubtful.

"The recent decline also suggests that a surge in online orders by American consumers before the withdrawal of de minimis exemption for e-commerce imports from China set for May 2has not materialised so far. One alleviating factor could be the U.S. government’s decision to exempt laptops, cell phones and semiconductors from its reciprocal tariffs on China for the time being."