No slowdown in strong air cargo demand, June figures show

No slowdown in strong air cargo demand, June figures show

Air cargo demand has been robust thus far in 2017.

The first of the monthly air cargo indicators is out for June and shows a continuation of the robust growth in demand for international air freight that began back in the second half of last year.

Preliminary traffic figures for the month of June released by the Association of Asia Pacific Airlines (AAPA) showed broad-based increases in new export orders drove up boost demand for air cargo shipments.

Asian airlines registered a firm 10 percent year-over-year increase in international air cargo demand as measured in freight metric ton km. Offered freight capacity increased by 4.8 percent, leading to a 3.1 percentage point increase in the average international freight load factor to 66.2 percent.

Andrew Herdman, AAPA director general, said global trade activity has picked up markedly since the middle of last year, with air freight volumes growing strongly.

“Overall, Asian airlines reported a 10.4 percent increase in international air cargo traffic volumes during the first half of 2017, supported by an upswing in export orders for both the leading emerging markets and advanced economies,” he said.

Herdman had more good news for the air cargo industry, saying that signs of ongoing positive momentum in the global economy left the air freight market well positioned to achieve still further growth in the second half of the year.

June figures from Hong Kong-based carrier Cathay Pacific, a member of AAPA, revealed the strength of the demand, increasing by almost 13 percent compared with the same month last year. In the first six months of the year, cargo tonnage rose 11.5 percent against a capacity increase of just 2.3 percent.

Mark Sutch, Cathay Pacific general manager cargo commercial, said the carrier’s cargo business remained robust throughout June and the overall tonnage was healthy.

“The new Tel Aviv service has built good air freight demand and we received an overall boost from shipments of fresh produce, speciality goods, toys, and automobile parts between Asia and the United States,” he said.

The Hong Kong-North America routes were performing well, and Sutch said Cathay’s two wet-leased freighters that were brought in to cope with rising trans-Pacific demand were operating at full capacity and “generating good revenues”.

“Looking ahead, the air freight market remains strong and this should continue through to the start of the traditional high demand season in September,” he said.

The International Air Transport Association (IATA) has yet to release its global air cargo figures for June, but they are expected to follow May’s solid 12.7 percent year-over-year growth as world trade continues to improve.

However, Alexandre de Juniac, IATA’s director general and CEO, said after the May results were released that there was some concern that inventor re-stocking had ended.

“The industry can’t afford to rest on its laurels,” he warned. “With indications that the cyclical growth period may have peaked, the onus is on the industry to improve its value proposition by accelerating process modernization and enhancing customer-centricity.”

Contact Greg Knowler at greg.knowler@ihsmarkit.com and follow him on Twitter: @greg_knowler.