IATA’s September airfreight traffic figures reveal only 2 percent increase in demand
Nov 9, 2018: Air freight market saw demand measured in freight tonne kilometers (FTKs), rise 2.0 percent year-on-year in September 2018, according to the latest data released by trade body International Air Transport Association (IATA).
This pace of growth was relatively unchanged from the previous month but was less than half the five-year average growth rate of 5.1 percent.
Freight capacity, measured in available freight tonne kilometers (AFTKs), grew by 3.2 percent year-on-year in September 2018. This was the seventh month in a row that capacity growth outstripped demand. Yields, however, appear to be holding up.
The weak growth is being supported by strong consumer confidence, a robust global investment environment and the expansion of international e-commerce. The air cargo sector is, however, being weighed down by a softening of key demand drivers:
There has been a global contraction in manufacturing firms’ export order books – the first since June 2017. Specifically, export order books contracted in all the world’s major exporting nations in September with the exception of the USA.
Longer supplier delivery times are being reported by manufacturers in most of Asia and Europe, the top two global trading areas by volume. This typically means that they have less need for the speed afforded by air freight.
"Demand for air cargo grew 2 percent in September—well below the five year average of 5.1 percent. Weakening order books and longer delivery times are undercutting the need for air freight in many traditional markets. But there is also some positive news. For example, strong consumer confidence goes hand-in-hand with expanding international e-commerce trade to give air cargo a boost. The bigger message for the sector is the need to modernize processes. There is some progress with the electronic air waybill becoming the default document on enabled trade lanes from 2019. But there is much more that must be done with governments and the supply chain to bring air cargo processes into the modern era," said Alexandre de Juniac, IATA's director general and CEO.
All regions reported year-on-year demand growth in September 2018, except Africa which contracted.
While Asia-Pacific airlines saw slight decrease in demand from the previous month, however the demand saw 1.2 percent growth in September 2018 compared to the same period last year.
North American airlines’ freight volumes expanded 1.5 percent in September 2018 compared to the same period a year earlier.
Surprisingly, Middle Eastern carriers’ posted the fastest growth of any region in September 2018, with an increase in demand of 6.6 percent compared to the same period a year earlier. This was more than double the pace of growth of other regions.
European airlines posted a 1.5 percent increase in freight demand in September 2018 compared to the same period a year earlier.
Latin American airlines experienced an increase in freight demand growth in September 2018 of 2.9 percent compared to the same period last year and capacity increased by 4.3 percent.
For the sixth time in seven months, the demand has contracted for African carriers. Freight demand contracted by 2.1 percent in September 2018, compared to the same month last year.
¹% of industry FTKs in 2017 ²Year-on-year change in load factor ³Load factor level
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