- Global aviation sector posts strongest H1 growth since 2010 – IATA
The International Air Transport Association (IATA) has released data for global air freight markets showing that demand, measured in freight tonne kilometers (FTKs), grew by 10.4 per cent in the first-half of 2017 compared to the first-half of 2016.
This, was the strongest first half-year performance since air cargo’s rebound from the Global Financial Crisis in 2010 and nearly triple the industry’s average growth rate of 3.9 per cent over the last five years.
African carriers had the fastest growth in year-on-year freight volumes, up 31.6 per cent in June 2017 and a capacity increase of 7.6 per cent. This contributed to freight demand growing 25.9 per cent in the first half of 2017 – the fastest of all regions.
Demand has been boosted by very strong growth on the trade lanes to and from Asia which have increased by nearly 60 per cent in the first five months of 2017.
Capacity grew 11.2 per cent in the first half of the year. Seasonally adjusted growth has levelled off in recent months; however growth is set to remain in double digits for the remainder of 2017.
Freight capacity, measured in available freight tonne kilometers (AFTKs), grew by 3.6 per cent in the first half of 2017 compared to the same period in 2016. Demand growth continues to significantly outstrip capacity growth, which is positive for yields.
Air cargo’s strong performance in the first half of 2017 was confirmed by June’s results. Year-on-year demand growth in June increased 11 per cent compared to the same year-earlier period. Freight capacity grew by 5.2 per cent year-on-year in June.
The sustained growth of air freight demand is consistent with an improvement in global trade, with new global export orders remaining close to a six-year high. However, there are some signs that the cyclical growth period may have peaked.
The global inventory-to-sales ratio has stopped falling. This indicates that the period when companies look to restock inventories quickly, which often gives air cargo a boost, may be nearing an end. Regardless of these developments, the outlook for air freight is optimistic with demand expected to grow at a robust rate of 8 per cent during the third quarter of this year.
“Air cargo is flying high on the back of a stronger global economy. Demand is growing at a faster pace than at any time since the Global Financial Crisis. That’s great news after many years of stagnation. And, even more importantly, the industry is taking advantage of this momentum to accelerate much-needed process modernization and improve the value it provides to its many customers,” said Alexandre de Juniac, IATA’s Director General and CEO.