Two weeks ago, when we published our analysis of the October data from some of the early-reporting major players, we predicted that when IATA and WorldACD published their worldwide summaries, growth in air freight demand would be 6% or higher. Today’s report from WorldACD of 6.2% year-over-year growth confirms our prediction.
Netherlands-based WorldACD measures air freight demand based on chargeable weight carried by airlines. However, several months ago, the company acknowledged that neither tonnes carried nor freight-tonne-kilometers flown (FTKs, the measure used by IATA) was a perfect measure of demand growth, and introduced a new measure — direct tonne kilometers, or DTKs — that it felt did a better job.
Using this new measure, demand was up 7.4% in October.
DTKs are calculated by multiplying the weight carried by the direct-flight distance between origin and destination. WorldACD says this is a more accurate reflection of demand because it eliminates the inflationary effect on FTKs of routes with intermediate stops. That is, demand for iPhones in Europe is the same whether those phones fly from China to Europe directly, or with a stop in Dubai, but the route via Dubai is over 3,000 kilometers longer, and using DTKs instead of FTKs more accurately reflects this.
According to WorldACD, it was freight moving from Asia to the rest of the world that drove the demand growth, with volume up 12% ex-China and 19% ex-Taiwan.
Turning from October to November (and ahead to December and January), early reports indicate the strongest peak season since the 2008 crash, with multi-day backlogs now growing in China, particularly in Hong Kong and Shanghai.