June cargo figures a pleasant surprise, says WorldACD

The air cargo market continued to surprise in June, says WorldACD, with a continuation of the volume growth seen for well over half a year, while US Dollar yields have halted their 2015-2016 free fall.
The analyst said: “This [growth] trend did not show the slightest tendency of tapering off in June. On the contrary, the volume increase year-over-year (YoY) for the month was 10.5%, accompanied by an increase in direct ton kilometres of 12%, showing that the average distance between origin and destination of shipments continues to increase.”
Meanwhile, worldwide yield, measured in US dollars, was 7% higher, “a big bonus for airlines and a development we have not been able to report since the recovery of 2010-11.”
In fact, volume growth in the second quarter of 2017 was the best quarter for the industry in almost seven years, WorldACD continues, with German and Hong Kong originating cargo growing most in absolute kilograms.
In percentage terms, markets from Turkey to the Middle East and South Asia (up 54%), from Belgium to Asia Pacific (+50%) and from Belgium to North America (+46%) showed the highest volume increase. In general, load factors increased, as capacity growth was lower than the increase in volumes in all regions.
Whereas the first quarter of 2017 showed stable year-on-year yields, the second quarter “surprised with a remarkable yield improvement YoY of 5.4% in US dollars, and of 8.1% in Euros. Yield improvements were particularly visible in markets with an origin in Asia Pacific.”
Yields out of China grew even more strongly than those from other countries in the region. Interestingly, positive yield and volume developments seemed to go hand in hand: from Asia Pacific to North America, growth of each was around 20%, and from Asia Pacific to Europe around 15%.
The report added: “A prominent element in the growth of both volumes and yields between Asia and North America was the modest capacity increase.”
The yield performance may be explained partly by movements in fuel prices and surcharges: fuel prices were about 10% higher YoY.
WorldACD says that in the past, yields have usually reacted to fuel price developments with a time delay. Since fuel prices increased strongly between the first and second quarters of 2016, yields in the second quarter of 2016 could be said to have been relatively low as the rising fuel prices had not yet been fully factored in. Given the increasing practice of net pricing, more research needs to be done on this subject, however.
Air cargo and geopolitics were intertwined in June 2017 as the transport of perishables to Qatar increased well beyond the overall growth pattern of this sector due to the trade embargo imposed by its neighbours.
Figures also confirmed the earlier trend for general cargo to grow faster than most specific product categories – apart from pharma. It also confirmed that the average shipment size is growing YoY: by more than 8% in June and by almost 7% for the first half of the year.
Read more air cargo data news

Share this story

Related Topics

Latest airfreight rates news

Etihad Cargo sees revenues decline in 2023 as market rates cooled

Etihad Cargo registered a decline in its cargo revenues last year as the wider air cargo market cooled following the…

Read More

Share this story

Airfreight rates on major trades remain down on 2023 levels in February

Air cargo rates continued to register declines on major east-west trades in February compared with last year as the timing…

Read More

Share this story

Awery reports Red Sea-related rates rise

There are conflicting opinions about the extent to which the Red Sea shipping crisis is impacting airfreight, but airfreight rates…

Read More

Share this story

Air Cargo News

Air Cargo News
Established in 1983, Air Cargo News is the leading source of news, information, interviews, analyses and reports to the global airfreight industry. Our leading portfolio includes print, digital and events that give businesses in the airfreight industry the ability to connect with decision-makers in this sector.