Global Air Cargo Traffic Extends Recovery

Global Air Cargo Traffic Extends Recovery

Global air freight traffic grew 2.9 percent in February from a year ago, extending and strengthening the recovery that began in the second half of 2013, the International Air Transport Association reported.

The increase, following growth of 4.5 percent in January, has boosted demand by 3.6 percent in the first two months of the year, the industry body said.

Air cargo and capacity growth by region, year-to-date 2014Traffic and capacity growth have been strongest at Middle Eastern air carriers this year.

Regional performance was mixed, with European and Middle Eastern carriers posting strong growth, while the Asia-Pacific and North American markets stalled or declined.

“There is good cause for measured optimism for the cargo industry’s prospects in 2014,” said Tony Tyler, IATA’s director general and CEO.

“The 3.6 percent growth in demand recorded over the first two months of this year is a significant step up from the 1.4 percent growth in demand over the whole of 2013.”

But there are “serious trends” that are not in the industry’s favor, Tyler cautioned.

Companies continue to “on-shore” their manufacturing supply chains, while the world’s top 20 economies implemented some 23 percent more protectionist measures last year than in 2009. FedEx Chairman and CEO Frederick W. Smith last month warned of the threat posed by rising protectionism in a keynote speech at the JOC’s TPM conference in Long Beach, Calif.

“These factors are a major reason why we are not seeing trade growth of five to six percent, which we would expect to see at the current level of domestic production.”

Most of the growth in February was driven by Middle Eastern and European airlines, which increased traffic by 11.9 percent and 5.5 percent respectively.

The increase in Europe, which was only slightly down from the 5.8 percent recorded in January, continues a steady rise in demand since mid-2013. Business activity is at the highest level since 2011, with trade growing particularly strongly in Central and Eastern Europe. Capacity was up 1.7 percent in February.

Asia-Pacific carriers grew just 0.1 percent in February, with China’s Lunar New Year holidays likely dampening demand a little. Regional trade has picked up in recent months, but China may be on the verge of an economic slowdown that would restrict trade and freight demand, according to IATA. Capacity grew faster than demand at 3.9 percent.

North American airlines posted a slight contraction of 0.3 percent year-over-year, but February business indicators in the manufacturing sector were close to a three-year high, suggesting resumed growth in exports and freight demand.

Latin American carriers boosted freight volume by 6.1 percent.

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