WorldACD says March offered some “hope of a change for the better” in a few of the world’s air cargo markets, but year-on-year (YOY) yields in US dollars still dropped by 18 per cent.
The industry market analyst says although YOY volumes dropped by 0.9 per cent worldwide, the flows from Asia Pacific to Europe and the Middle East & South Asia (MESA) showed growth of 19 per cent and 12 per cent, respectively.
Volumes from MESA to Europe were up by nine per cent. Europe and MESA were the regions performing best in incoming traffic growth of eight per cent and three per cent respectively.
YOY yields (in USD) dropped by 18 per cent, but the least affected were Central & South America (minus two per cent) and Africa (minus five per cent).
However, WorldACD says yields held up better when compared to February 2016. Worldwide they fell by 1.9 per cent, with Africa and Asia Pacific doing slightly better than average, although the month-over-month yield change in these two origins was negative.
For the first quarter (Q1) worldwide volumes dropped by 1.3 per cent, and yield in US dollars by 17 per cent, but the comparison has to be measured across the boost the Pacific got in Q1 of 2015 with the US West coast port slowdown.
WorldACD says: “So, when excluding the flows between Asia Pacific and North America, the worldwide picture for Q1 is quite different: worldwide volumes increased by 1.4 per cent YOY, whilst the yield drop was limited to 13.6 per cent.
“Just looking at outbound flows from Asia Pacific, we see the following: volumes down by 3.9 per cent with yield in US dollars decreasing by 23.8 per cent. Taking out the flow to North America, however, these figures change considerably, to a volume increase of 1.5 per cent and a yield drop of 16.6 per cent.”
Despite the reported slump in business from China, it was still air cargo’s main growth engine. YOY volume in Q1 was up by six per cent, and by 18 per cent in the markets from China to Western Europe.
However, this growth came at the price of a heavy drop in yields as Q1 revenues (in US dollars) between China and Western Europe dropped by 12 per cent YOY, due to a yield decrease of over 25 per cent.
WorldACD says the two product categories that have propped up the air cargo performance for quite a while (perishables and pharmaceuticals) continued to do so in Q1.
Perishable volumes increased by over six per cent and pharmaceuticals by just under 10 per cent and WorldACD explains: “Given the fact that the latter has a yield more than 60 per cent over the general cargo yield, coupled with a much smaller yield decline YOY, it is understandable that carriers want to grab a part of this market.
“The highest yielding cargo category, live animals, which covers less than one per cent of total cargo volumes, saw a decline of 5% in volumes coupled with a yield increase of two per cent.”