Strong 2016 closeout raises IATA’s global airfreight volumes

Confirming several other reports on the recent surge in demand for air cargo services, the International Air Transport Association (IATA) found that airfreight demand, measured in freight tonne kilometers (FTKs), grew by 3.8 percent in 2016, compared to 2015, according to the latest global data. Growth in 2016 was well ahead of the industry’s average growth rate of 2 percent over the last five years. However, freight capacity grew by 5.3 percent in 2016, suggesting continued downward pressure on rates in the year ahead.

After a weak start to the year, freight volumes recovered in 2016 with a strong close-out in December in all regions except Latin America. Peak season volumes provided the requisite boost, and IATA noted that, “the early timing of the Lunar New Year [in late January 2017] may also have helped push demand higher in December.”

Below is a summary of IATA’s regional growth breakdown:

• European airlines led all regions in growth, posting a 7.6 percent rise in demand over the previous year, “with the sustained increase in export orders in Germany and the ongoing weakness in the euro.” Capacity for European carriers, however, also increased by 6.7 percent over the previous year.
• Middle Eastern carriers’ freight volumes increased by 6.9 percent in 2016 – the second fastest growth rate of all the regions, but nothing unusual for a region used to double-digit growth over the last decade. The market seems to be leveling off.
• African carriers had annual growth in freight demand of 3.1 percent in 2016, down from 4.5 percent in 2015. However, capacity surged by 25.5 percent in the 2016 calendar year on the back of long-haul expansion, particularly by Ethiopian Airlines, causing a fall in load factors.
• Asia-Pacific carriers grew freight volumes by 2.1 percent in 2016 compared to 2015. The results benefitted from a strong end-of-year performance. However, growth trailed 2015’s 2.3 percent increase. Capacity on the region’s airlines increased 3.6 percent in 2016.
• North American carriers saw freight demand increase by 2 percent in 2016, up from 1.3 percent the previous year. IATA noted that, “the strength of the U.S. dollar continued to boost its inbound market but kept the export market under pressure.”
• Latin American airlines experienced a demand contraction of 4.2 percent in freight volumes in 2016. This was the second consecutive year that demand has fallen. IATA noted that, “the region continues to be blighted by weak economic and political conditions, particularly in the largest economy, Brazil.”

Those interested in learning more about air freight in 2017, should join us at Cargo Facts Asia in Shanghai, 25 – 26 April.  To register, or for more information, go to CargoFactsAsia.com.