Two weeks ago, when we analyzed February results from some of the world’s major cargo carriers and airports, we predicted that when IATA published it’s worldwide summary in early April, we would see demand growth in, or approaching, double digits.
Looking at IATA’s report, out this morning, it turns out we were right. On an as-reported basis, IATA said worldwide air freight traffic was up 8.4% y-o-y. But, after adjusting for the fact that 2016 was a leap year, in which February had an extra day, February 2017 traffic was up 12%.
The as-reported data, as shown in the chart above, paints a picture of very strong growth, but, adjusting for the extra day in February 2016 makes it clear that demand growth was even stronger than it at first seems:
- Africa: Up 14%
- Asia Pacific: Up 15%
- Europe: Up 14%
- Latin America: Down 1%
- Middle East: Up 7%
- North America: Up 9%
- Total worldwide: Up 12%
Of course, February data, on its own, is always suspect because the variable timing of the Chinese New Year holiday has a big impact on the movement of cargo in the first two months of the year. To get a true picture of underlying growth we must treat January and February as a single month. And this year, since January also saw unusually strong growth, IATA reports traffic for the combined “month” up 7.2%. IATA did not provide adjusted data for the combined period, and the impact of one extra day will be less over the longer period, but it seems safe to add about two percentage points to the growth rate — so, yes, it is definitely time to break out the Champagne.
In discussing the results, IATA said the growth of air freight demand so far this year was “consistent with an uptick in world trade.” IATA also pointed out three sectors of particular note: the expanded volume of semi-conductor materials typically used in high-value consumer electronics, the rapid growth of cross-border e-commerce, and the rapid growth of demand from the pharmaceutical industry.
Will demand remain strong? Early reports for March are encouraging, but we will have to wait another week or two before hard data become available. And if you are interested in a look at the longer-term future of air freight demand, you should join us in Shanghai, 25-26 April, for Cargo Facts Asia, where that subject will be discussed in the opening session “Trends in Asia Pacific Air Cargo.” To learn more, or to register, visit www.cargofactsasia.com.