Air cargo volumes stagnate and load factors slide in June

The air cargo industry faced another tough month in June as volume growth “stagnated” and load factors continued to slide.
Airline organisation IATA’s monthly airfreight market analysis has revealed that cargo traffic in freight tonne km terms increased by 1.2% in June compared with a year earlier.
This lags behind the 3.5% growth rate recorded for the first six months of the year and is also the lowest level recorded so far in 2015.
Meanwhile, capacity for the month in available freight tonne km terms increased by 5.2% on a year earlier.
As a result of supply increasing ahead of demand, load factors declined to 43.2% compared with 44.3% in May.
IATA director general and chief executive Tony Tyler was downbeat in his assessment of the figures.
He said: “The half-year report for air cargo is not encouraging. With growth of just 1.2% over June last year, markets are basically stagnating.
“Some carriers are doing better than others at picking up the business that is out there, but overall it has been a disappointing first half of 2015, especially considering the strong finish to 2014.
“The remainder of the year holds mixed signals. The general expectation is for an acceleration of economic growth, but business confidence and export orders look weak.
“Air cargo and the global economy will all benefit if governments can successfully focus on stabilising growth and stimulating trade by removing barriers.”
The declines varied from market to market, with Asia-Pacific, North American and Latin American carriers reporting year-on-year declines of 0.3%, 3.3% and 1.6% respectively, while European carriers reported that markets were flat.
This was offset by the strong performance of Middle Eastern carriers, which recorded growth of 15.3%, and African carriers, which saw volumes increase by 6.7%.
“The decline in world trade reflects a combination of weaker than expected global economic growth, in emerging markets and the US, as well as shifts toward the domestic market in China,” IATA said.
“Recent improvements in business confidence in the Eurozone have not benefited airfreight as consumer sentiment remains hampered by concerns about Greece exiting the Eurozone.
“North American carriers have experienced a significant decline inFTK volumes since the boost from modal shift due to sea port congestion earlier in the year.
The organisation said it would stick to its view that economic growth and trade will accelerate in the second half of the year, strengthening growth in air cargo volumes.
But it warned that current demand conditions are gloomy and June data shows no increase in business confidence compared to the start of the year and growth in export orders remains weak.

Source: IATA