The global airfreight market is forecasted to grow by 3.2 per cent annually between 2016 and 2021 following years of weak growth, according to data from research company MarketLine.
The report says the airfreight industry saw compound annual growth rate of 0.7 per cent between 2012 and 2016, reaching $101.3 billion, but this is expected to increase to 3.2 per cent up to 2021 when it will be $118.7 billion.
MarketLine says growth will primarily be driven by the Middle East and Asia Pacific as a result of increased manufacturing while domestic markets in countries such as China and India offer potential for growth.
MarketLine analyst, Paul Todd says: “The International Air Transport Association (IATA) suggested a global price drop per Freight Tonne Kilometre (FTK) in 2016. As such, a global decrease in the value was identified in 2016 despite volume continuing to climb.”
“Whilst the price of crude oil has decreased, allowing a certain amount of breathing room for freight companies, the effect of overcapacity has suppressed freight yields and forced rates downwards.”
He warns companies must consider the threat from alternative freight methods though adds: “Oversupply or increased competition may be potential threats, but the recent bankruptcy of Hanjin, a leading marine freight company, could be positive for the air freight sector as its players may pick up some trade from consumers who have lost confidence in marine transport.”