Middle East carriers’ year-on-year freight volumes increased 14.1 per cent in August and capacity increased 2.8 per cent, the International Air Transport Association (IATA) said.
The strong pick-up in demand largely reflects favourable comparisons to a short-lived weak patch in 2016 rather than an acceleration in the current demand trend. Seasonally-adjusted international freight volumes have maintained their solid upward trend.
"However, amid strong competition from other region’s carriers particularly on the Asia-Europe route, the Middle East carriers are not seeing as strong a pick up in the seasonally-adjusted traffic trend as other region’s carriers," IATA added.
For global air freight markets demand, measured in freight tonne kilometres (FTKs), increased by 12.1 per cent in August, compared with the same period a year ago. This was the fifth time in six months of double-digit gains on the previous year’s performance, the association said. 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 kilometres (AFTKs), grew by 4.7 per cent year-on-year. Demand growth continues to significantly outstrip capacity growth, which is positive for industry load factors, yields, and financial performance, IATA said.
The strong performance of air freight demand corresponds with the pick-up in global trade. World trade volumes grew 4.2 per cent in the first seven months of 2017 compared with 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.
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Signs that the peak of the cyclical growth period may be near also continue, IATA said. "The global inventory-to-sales ratio in the US, for example, has stopped falling. This usually means that re-stocking to meet demand (which gives air freight a boost), is ending."
But the outlook for air freight remains strong. With several months of double-digit growth in 2017, the current IATA forecast of 7.5 per cent growth in air freight demand for 2017 "appears to have significant upside potential even if we are approaching a cyclical peak", said the association.
“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," said Alexandre de Juniac, IATA’s director general and chief executive. "The pace of capacity growth, however, has slowed even as freighter fleets are being utilised 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.
Asia-Pacific airlines’ freight volumes grew 11.3 per cent and capacity increased by 5.7 per cent. North American carriers posted an increase in freight volumes of 11.7 per cent in August, and a capacity increase of 3.7 per cent.
European airlines posted an 11.8 per cent increase in freight demand and a capacity increase of 5.1 per cent. Latin American airlines experienced a growth in demand of 8.5 per cent in August and capacity increased by 9.3 per cent compared with the same period in 2016. International freight volumes increased by 9.5 per cent over the same period. This is close to a seven-year high and well above the five-year average rate of minus 0.1 per cent, IATA said.
African carriers posted the largest year-on-year increase in demand of all regions in August 2017 with freight volumes growing 29.4 per cent. This is a slight slowdown from July but still more than three times the five-year average pace of growth of 8.8 per cent. Capacity increased by 5.9 per cent over the same period. Demand has been boosted by very strong growth on the trade lanes to and from Asia which increased by more than 67 per cent in the first half of the year, IATA said.