IATA: Airfreight demand soars in July, but could be nearing peak

Global airfreight volumes in July increased 11.4 percent from 12 months prior, while available airfreight capacity rose 3.7 percent, according to the latest figures from the International Air Transport Association (IATA).    Global airfreight volumes in July increased 11.4 percent from 12 months prior, according to the latest figures from the International Air Transport Association (IATA).
   Available airfreight capacity during the month rose 3.7 percent year-over-year.
   “Demand growth continues to significantly outstrip capacity growth, which is positive for airline yields and the industry’s financial performance,” IATA said.
   Asia Pacific airfreight carriers saw volumes in July increase 11 percent year-over-year, with robust demand growth on all major routes to, from and within the region.
   Volumes flown by European airfreight carriers during the month rose 12.1 percent from July 2016, as the region’s airlines have been benefitting from robust demand on routes to and from Asia and North America.
   North American airfreight carriers in July experienced an 11.9 percent year-over-year boost in volumes. The strength of the U.S. dollar has increased the inbound freight market over the past few years, but the decline in the U.S. dollar since the start of the year is likely to help rebalance trade flows, IATA said.
   Volumes carried by Middle Eastern airfreight carriers during the month increased 9.3 percent from July 2016.
   Meanwhile, Latin American airfreight carriers experienced volumes growth of 5.8 percent year-over-year in July. However, the region continues to face headwinds from challenging economic and political conditions, particularly in its largest economy, Brazil.
   Volumes flown by African airfreight carriers during the month were especially strong, rising 33.7 percent from July 2016, fueled by strong growth on the trade lanes to and from Asia.
   Looking ahead, IATA said there are signs that demand growth for airfreight may be reaching a peak. “Seasonally-adjusted air freight volumes were flat in June and fell in July; and the global inventory-to-sales ratio has stabilized,” IATA explained. “Air cargo often sees a boost in demand at the beginning of an economic upturn as companies look to restock inventories quickly. This tapers as inventories are adjusted to new demand levels.”
   Overall, the Asia-Pacific makes up 37.4 percent of the total freight traffic market share, based on freight ton kilometers, followed by Europe at 23.5 percent, North America at 20.7 percent, the Middle East at 13.9 percent, Latin America at 2.8 percent and Africa at 1.6 percent.