The International Air Transport Association (IATA) has released June figures showing a 1.2% year-on-year expansion in global air freight demand. Although weak, this is an improvement when compared to the 0.9% year-on-year demand growth recorded in May and the 0.1% growth realised over the first half of the year.
While previously the global economic trend has been defined by robust emerging economies and stagnant growth in developed markets, the strongest improvements in business confidence are now occurring in some developed economies. Nevertheless, overall business confidence, which is a key indicator for air freight, continues to be weak.
From May to June, global freight volumes increased by 0.8%. A quarter of that improvement was captured by European airlines, which saw a 0.9% improvement in demand compared to May, and 2.6% up compared to June 2012. In contrast, Asia-Pacific carriers (the biggest players in global air freight) and North American airlines recorded year-on-year declines of 1.8 and 1.2% respectively.
Tony Tyler, IATA’s director general and CEO, says: “It’s too early to tell if June was a positive turning point after 18 months of stagnation. Air freight volumes are at their highest since mid-2011, but that good news needs to be tempered with a dose of reality. The global economic environment remains weak, and the basis for the acceleration of air cargo growth in June appears to be fragile.”
IATA also released the July edition of its Airline Business Confidence Index, which showed nearly 58% of respondents expecting freight volumes to increase over the next year. Despite this, a much greater percentage of respondents (72.2%) expected no change in weak cargo yields despite their expected increase in demand over the same period. The macroeconomic trend remains challenging. Recent declines in global export orders do not bode well for trade growth.
African airlines recorded relatively slower growth in June, up 2.4% on June 2012. This lags the year to date trend of 4.3%, which is the second best of all regions. With economic growth in some key African markets looking strong, demand for high-value lightweight consumer goods should rise, helping air freight volumes in the months to come.