Air cargo demand grew by a double-digit figure for the fifth time in six months in August, according to figures released by the International Air Transport Association (IATA).
The association says freight tonne kilometers (FTKs), increased YOY by 12.1 per cent in the month, compared to the same period a year ago with Africa up YOY 29.4 per cent, the Middle East 14.1 per cent, Europe 11.8 per cent, North America 11.7 per cent, Asia Pacific 11.3 per cent and Latin America 8.5 per cent.
IATA notes demand is growing at “exceptional speed” when compared to the five-year average growth rate of 4.4 per cent.
Freight capacity, measured in available freight tonne kilometers (AFTKs), grew YOY by 4.7 per cent in August 2017.
IATA says demand growth continues to significantly outstrip capacity growth, which is positive for industry load factors, yields, and financial performance.
The strong performance of airfreight demand corresponds with the pick-up in global trade as IATA notes world trade volumes grew 4.2 per cent in the first seven months of 2017 compared to 2016, their strongest performance since 2011.
This is consistent with rising export orders, which are currently around their highest levels since March 2011, and upbeat business confidence indicators.
IATA notes signs the peak of the cyclical growth period may be near also continue as the global inventory-to-sales ratio in the US, has stopped falling and this usually means re-stocking to meet demand is ending, which gives airfreight a boost.
The outlook for the air cargo industry remains strong and with several months of double-digit growth in 2017, the current IATA forecast of 7.5 per cent growth in airfreight demand for the year appears to have significant upside potential even if the industry is approaching a cyclical peak.
IATA director general and chief executive officer, Alexandre de Juniac (pictured above) says: “Air cargo had another stellar performance in August. Demand for air cargo grew at a double-digit rate for the fourth month in a row – outperforming demand for passenger travel for the fourth consecutive month.
“Rapid growth in cargo demand means that cargo capacity is now growing in response to real cargo demand rather than automatically as carriers responded to passenger demand.
“The pace of capacity growth, however, has slowed even as freighter fleets are being utilized more intensely. Overall, that should be good news for much beleaguered cargo yields.”