Global air freight demand increases by 14% in March – IATA

The International Air Transport Association (IATA) has released its March 2017 demand growth results for global air freight markets showing a 14 per cent expansion measured in freight tonne kilometers (FTKs) compared to the same period last year.

IATA said this was the fastest pace of growth recorded since October 2010. Freight capacity, measured in available freight tonne kilometers (AFTKs), grew by 4.2 per cent year-on-year in March 2017.

March performance contributed to very strong first quarter growth (Q1) in freight volumes. After adjusting for the impact of the leap year in 2016, freight demand in Q1 2017 increased by nearly 11 per cent. Capacity increased by 3.7 per cent over the same period.

The strengthening of air freight demand in March is consistent with an uptick in world trade and a six-year high in new export orders.

An increase in the shipment of silicon materials typically used in high-value consumer electronics shipped by air, is also likely underpinning a portion of the strong performance.

“March capped a robust first quarter with the strongest year-on-year air freight growth in six-and-a-half years. Optimism is returning to the industry as the business stabilises after many years in the doldrums.

“There is, however, still much lost ground to recover while facing the dual headwinds of rising fuel and labour costs. It remains critical to use the improvement in the industry’s fortunes as an opportunity to enhance the value offering by implementing modern customer-centric initiatives that streamline processes and reduce costs,” said Alexandre de Juniac, IATA’s Director-General.

All regions, with the exception of Latin America, reported year-on-year increases in demand in March 2017.

Airlines in Europe and Asia-Pacific posted the strongest growth accounting for two-thirds of the industry-wide increase in demand.

The remaining growth was split between North American and Middle Eastern carriers, with African airlines making a modest contribution.

African carriers’ posted the largest year-on-year increase in demand of all regions in March 2017 with freight volumes growing 33.5 per cent.
Capacity increased by 6.3 per cent over the same time. Demand has been boosted by very strong growth on the trade lanes to and from Asia following an increase in direct services between the continents.

The increase in demand has helped the region’s load factor rise by 6 percentage points compared to March 2016.

European airlines posted an 18.2 per cent increase in freight volumes in March 2017 and a capacity increase of 6.7 per cent.

International freight volumes grew by 18.1 per cent year-on-year, the fastest pace in six years. Seasonally-adjusted freight volumes continue to trend upwards.

The on-going weakness of the Euro persists in boosting the performance of the European freight market which has benefitted from strong export orders over the last few month