The impact of the factory closings in key countries such as China and Vietnam during Chinese New Year were felt in the worldwide year-over-year air cargo volume growth in February, according to the World ACD Market Data report.
While air cargo volume rose 4.4% in the month from a year earlier, it was below the growth reported for January, resulting in a combined growth of 6.95% for the first two months of the year compared to the same period in 2017.
“A good start of the year by any standard, except by the standard of the extraordinary year 2017,” World ACD said in its report that measures 74 airlines and more than 30,000 forwarder locations. “Yet, we still reserve our final judgment, as past experience has taught us that the post-CNY effects may last as long as three weeks, in other words into March.”
Factories can close for up to four weeks during the period as workers return home to their families. Last year, the Chinese or Lunar New Year fell more than two weeks earlier in the calendar.
World ACD, which provides market intelligence services in air cargo, said Asia Pacific and the Americas points of origin cargo grew more than their average in these two months–9.3% and 8.4%, respectively–while the best destinations overall were Europe with 9.5% growth, Central & South America with an 8.5% increase and Africa with an 8.4% gain.
Worldwide yields (average earnings made by an airline on cargo per mile flown) rose 19.9% in dollar terms to $1.91 in February, which was 1 percent above January and 23.1% higher than in February 2017.
The year-over-year oil price increase and the lower value of the dollar were important elements in this comparison, World ACD noted. The highest yield at $3.26 was found on Hong Kong to U.S. flights, while the lowest at $1.49 was on Mumbai, India, to U.K. routes.
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“But there is more to interpret these figures,” the Amsterdam-based organization said. “Take the high-yielding markets from Asia Pacific on the one hand to Europe and North America on the other. Strong pre-CNY demand caused these large markets to grow much more in February than in January, thus boosting the average yield worldwide…The main reasons were Asia Pacific as a destination showed a negative growth year over year, in particular to Hong Kong, Eastern China and Taiwan, and the origin Europe, having shown a 12 percent year-over-year increase in January, fell back to a paltry 0.5% year over year in February.”
Overall, air cargo has seen substantial increases in usage and capacity in recent years as the need for on-demand B2B and B2C commerce has risen, notably thanks to the dynamic gains in e-commerce.
Measuring data on 800 general sales agents (GSAs) operating under more than 1,000 brand names, volume growth for the Top 10 in 2017 varied from 1 percent to 54 percent.