The data for global air freight markets has shown that there was 4.2% rise in demand, measured in freight tonne kilometers (FTKs), in May 2018 when compared to the same period in 2017. This was slightly down from the 5.2% (revised from 4.1%) growth in annual demand recorded in April 2018.
The data also indicated that only Africa among other regions of the world did not report an increase in growth in the month.
This was contained in the data released by the International Air Transport Association (IATA) in Geneva, Switzerland and a copy made available to PortNews in Lagos, Nigeria.
According to IATA, freight capacity, measured in available freight tonne kilometers (AFTKs), grew by 6.2% year-on-year in May 2018. This was the fourth month in a row that capacity growth outstripped demand growth.
After a weak start to 2018, demand for global air freight has now resumed a modest trend upwards. However, the rapid growth seen in 2017 is now over, with demand growing at a significantly slower pace in 2018. In IATA’s mid-year industry outlook, 2018 freight growth was revised downwards to 4.0% (from the previously forecasted 4.5% in December 2017)
There are three indications that growth will continue at a slower pace: the re-stocking cycle which required quick delivery to meet customer needs is over, the new export orders component of the global manufacturing Purchasing Managers’ Index (PMI) is at a 21- month low and global trade appears to be softening as trade tensions increase
IATA’s Director General and CEO, Alexandre de Juniac has this to say on the development, “We expect air cargo demand to grow by a modest 4.0% in 2018. That’s an uptick from a very weak start to the year. But headwinds are strengthening with growing friction among governments on trade. We still expect demand to grow, but those expectations are dampened with each new tariff introduced. Experience tells us that trade wars, in the long run, only produce losers.”
The data stated that all regions of the world except Africa reported an increase in growth in May 2018.
‘’Africa airlines saw freight demand contract 2.0% in May 2018 compared to the same month last year. Capacity increased by 20.4%. After a surge in international FTK volumes last year, seasonally-adjusted international freight volumes have now trended downwards at an annualized pace of 15% over the past six months. This mainly reflects a softening in demand on markets to/from Asia and the Middle East,’’ said the data.