Airfreight demand gathered momentum as 2014 progressed, but revenues were the same as 2013 at $62 billion, the International Air Transport Association (IATA) reports in its full-year market analysis.
Last year, growth was 4.5 per cent for freight tonne kilometres (FTK), compared to the 1.4 per cent rise recorded for the previous twelve months, while available FTK (AFTK) grew 3.7 per cent.
IATA says 2014 ended on a positive note with 4.9 per cent FTK growth in December, and AFTK rose 4.6 per cent compared to the same month in 2013.
“After several years of stagnation, the air cargo business is growing again,” says IATA’s director general and chief executive, Tony Tyler. “This is largely being driven by the uptick in world trade over the second half of 2014.”
He warns that the world’s economic troubles have yet to have an effect on airfreight, so potentially rocky times could lie ahead. “Recent concerns over the health of the global economy and a corresponding fall in business confidence have not yet impacted air cargo. But, it is a downside risk that will need to be watched carefully as we move through 2015,” Tyler explains.
During 2014, IATA says growth took place in all regions, but the Asia Pacific and Middle East continue to lead the way, growing 5.4 per cent and 11 per cent, respectively. Asia Pacific volumes have benefitted from increasing import demand in addition to continuing manufacturing strength. Japanese and Chinese markets were particularly important contributors.
Carriers’ extending their networks and expanding capacity by 11 per cent have fuelled growth in the Middle East, which IATA says has made the region a “hub for freight traffic”. Carriers in North America grew by 2.4 per cent driven by import and export demand, and Europe increased by two per cent, but IATA says the Eurozone remains weak and close to recession while Russian sanctions are also having an impact.The association says Africa saw growth of 6.7 per cent, despite Nigeria and South Africa underperforming during parts of 2014, although regional trade activity held up, supporting demand for the air transport of goods.
The weakest airfreight region in 2014 was Latin America, which rose 0.1 per cent, as it was affected by the economic slowdown.
Tyler says despite the improving growth trend, big challenges remain as yields declined for a third straight year, with no prospect of improvement. Cargo revenues are unchanged at $62 billion, which is still $5 billion below their 2011 peak.
“To move forward, the industry is focusing on providing a stronger value proposition to meet evolving customer needs. That’s what is driving efforts such as cutting shipping times, ensuring high quality handling of temperature sensitive goods, or benchmarking quality to improve customer transparency,” adds Tyler.