Demand for air freight increases 8.5 percent y/y in April, says IATA
Jun 02, 2017: Global air freight markets have seen demand measured in FTKs (freight tonne kilometers) increase by 8.5 percent year-on-year in April, down from 13.4 percent in March, according to the recent report released by the International Air Transport Association (IATA).
While this was down from the 13.4 percent year-on-year growth recorded in March 2017, it is well above the average annual growth rate of 3.5 percent over the past five years.
Growth in freight capacity, measured in available freight tonne kilometers (AFTKs), slowed to 3.9 percent in April 2017.
Business confidence indicators remain consistently upbeat, suggesting year-on-year FTK growth will remain robust for the rest of the second quarter. However, there are signs that the cyclical growth peak for air cargo has passed, particularly given that the inventory-to-sales ratio stopped falling at the end of last year. Air cargo often sees a boost in demand at the beginning of an economic upturn as companies look to restock inventories quickly. This tapers as inventories are adjusted to new demand levels. Over the whole year, air freight is headed for a healthy growth rate of 7.5 percent, supported by strong pharmaceuticals and e-commerce.
"Demand eased in April. Growth rates, however, are still much more robust than anything we have seen in the last six years. That’s good news, but it should not be taken as a message that all is well in air cargo. The industry’s antiquated processes need modernization. With e-air waybill utilization topping 50 percent in April, progress is being made. And we must harness the momentum to drive transformational change across the way the industry operates," said Alexandre de Juniac, IATA’s director general and CEO.
Airlines registered in Asia Pacific and Europe accounted for more than 70 percent of the annual increase in freight volumes, with North American airlines accounting for much of the rest. Middle Eastern and African airlines contributed positively, but Latin American carriers detracted from annual FTK growth for the 25th time in 27 months.