Air cargo down again in June as signs of a recovery were premature

By Damian Brett

Air cargo traffic has now declined year-on-year for eight months in a row and signs of a recovery in recent months have turned out to be premature.

The latest figures from airline association IATA show that demand in terms of freight tonne kms (FTK) declined by 4.8% year on year in June bringing performance for the first six months to a decline of 3.6%.

Capacity during the month in available FTK terms was up 2.6% and as a result the freight load factor slumped to 45.4% compared with 48.9% in June 2018.

IATA said that signs of a modest recovery in recent months appear to have been premature, with the June contraction broad-based across all regions with the exception of Africa.

Globally, trade growth is languishing, and business uncertainty is compounded by the latest tariff increases in the US-China trade dispute, IATA said.

IATA director general and chief executive Alexandre de Juniac said: “Global trade continues to suffer as trade tensions — particularly between the US and China — deepen. As a result, air cargo markets continue to contract. Nobody wins a trade war. Borders that are open to trade spread sustained prosperity. That’s what our political leaders must focus on.”

The IATA figures reflect those presented by analyst WorldACD, which show a decline in airfreight volumes of 8.9% in June compared with the same month in 2018.

“Only high tech (+3.7%), pharmaceuticals (+5.3%), flowers (+4.6%) and fish/seafood (+4.5%) resisted the onslaught, but the first two of these categories paid a price for their volume growth in the form of yields falling more than volume increased,” the analyst said.

Looking at regional performance, IATA figures show that Asia-Pacific airlines saw demand for airfreight contract by 5.4% in June.

“Although an important factor, the US-China trade war is not solely responsible for the fall,” IATA said. “FTKs for the ‘within-Asia market’ have decreased more than 10% over the past year.”

North American airlines saw demand decrease by 4.6% compared to the same period a year earlier and capacity increased by 1.9%.

IATA said that US-China trade tensions were weighing on the performance, with FTKs to Asia down 5%. FTKs on routes to/from Europe, South America and Middle East were also lower.

Airlines based in Europe posted a 3.6% year-on-year decrease in freight demand in June as comparatively strong cargo volumes within Europe helped to minimise the impact of weaker German exports.

There was a 7% decline in Middle Eastern airlines’ freight volumes in June and capacity increased by 2.7%. “Volumes to Europe (-7.2%) and Asia-Pacific (-6.5%) were particularly weak,” IATA said.  

Latin American airlines experienced a decrease in freight demand in June 2019 of 1% compared to the same period last year and capacity increased by 4.6%.

IATA said that much of the decline in traffic can be attributed to weakness in the ‘within-South America market’, especially Brazil and Argentina, where FTKs fell 6.5%. 

Finally, African carriers managed to report growth in June with an increase in demand of 3.8% year on year but capacity was up by more than 16%.

“This makes Africa the strongest performer for the fourth consecutive month. Route analysis shows that the Africa-Asia performance is strong—up 12% year-on-year,” IATA said.

Share this story
Facebook
Twitter
LinkedIn

Related topics

Latest airlines news

Smart move by Lufthansa Cargo

A new smartBooking feature provides Lufthansa Cargo customers and partners with a binding offer that can be booked online immediately….

Read More

Airbus BelugaXL receives EASA type certification

By Rachelle Harry

Airbus’s BelugaXL is set for entry-into-service by early 2020, after having received type certification from the European Aviation Safety Agency…

Read More

Staff strike could shut down South African Airways, warn managers

South African Airways (SAA) management is warning that a potential strike carried out by cabin crew and other workers could…

Read More