Global air freight volume 12.1% in August compared to the same period a year ago, the fifth time in the last six months of double-digit gains on the previous year’s performance, according to the International Air Transport Association.
Demand is growing at exceptional speed when compared to the five-year average growth rate of 4.4%, while freight capacity, measured in available freight ton kilometers, grew 4.7% year-on-year in August.
The strong performance of air freight demand corresponds with the pick-up in global trade. World trade volumes grew 4.2% 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.
The apparel industry is utilizing air fright more than in the past to meet demands for fast turns times on production and as e-commerce increases and brings the need for at-once order fulfillment.
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The outlook for air freight remains strong. With several months of double-digit growth in 2017, the current IATA forecast of 7.5% growth in air freight demand for 2017 appears to have significant upside potential, even if analysts forecast the approach of a cyclical peak.
“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,” said Alexandre de Juniac, director general and chief executive officer of the IATA. “Rapid growth in cargo demand means that cargo capacity is now growing in response to real cargo demand rather than automatically…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.”
All regions, with the exception of Latin America, posted double digit freight growth in August.
North American carriers posted an increase in freight volumes of 11.7% in August and a capacity increase of 3.7%. IATA noted that the strength of the dollar has boosted the inbound freight market over the past few years. Data from the U.S. Census Bureau shows a 12.7% increase in air imports to the U.S. in the first seven months of 2017.
Asia-Pacific airlines’ freight volumes grew 11.3% in the month compared to the same period a year earlier, and capacity increased 5.7%. Demand growth was strong on all the major routes to, from and within Asia-Pacific, consistent with strong export order books for the region’s manufacturers.
European airlines posted an 11.8% increase in freight demand in August and a capacity increase of 5.1%, with double-digit growth in international demand recorded in 10 of the past 12 months.