Worldwide air freight traffic in July increased 11.4% compared to the same period last year as an uptick in global trade and rising export orders have boosted the sector, according to IATA’s July Air Freight Market Analysis.

July’s air freight traffic growth exceeded June’s year-over-year (YOY) growth by 0.4 point, and was more than three times higher than the 10-year average growth rate of 3.1%. July’s total market freight capacity was up 3.7% YOY (down from 5.2% growth in June) and produced a 43.7% freight load factor for the month, up 3 points from July 2016.

“For the third consecutive month, demand for air freight grew at a faster pace than demand for air travel,” IATA DG and CEO Alexandre de Juniac said. “While the outlook for the rest of the year remains positive, there are signs that the cyclical growth period may be nearing a peak.”

As IATA senior economist David Oxley pointed out, seasonally adjusted industry FTKs were flat in June and fell in July for just the second time in 12 months to approximately 20 billion FTKs. “Moreover, the air freight demand indicators … are becoming less supportive for freight growth, particularly business confidence,” Oxley said. “The indicator has broadly tracked sideways so far this year … [and] recent development is consistent with a moderation in [YOY] air freight growth towards the end of the year.”

But in July, all regions posted strong air freight growth:

  • Asia-Pacific carriers, responsible for 37.4% of the world’s air cargo movement in July, had an 11% increase in traffic as capacity increased 6.3%, for a freight load factor (FLF) of 55%. European carriers, with a 23.5% share of cargo traffic, had a 12.1% rise in traffic on a 5.5% capacity rise, for a 44.2% FLF, as demand grew on the Europe-Asia market.
  • North American carriers, with a 20.7% market share, had an 11.9% increase in air freight traffic on 1.1% capacity growth, for a 34.9% FLF. “Data from the US Census Bureau shows that import volumes coming into the US by air rose by 12.5% YOY in H1 2017, compared to a slower 5.4% increase in exports,” Oxley said, adding that a lessening of the value of the US dollar since the start of the year is likely to help rebalance trade flows by boosting exports and deterring imports.
  • Middle Eastern carriers, with a 13.9% market share, showed a 9.3% rise in traffic as capacity decrease 0.4%, resulting in a 43.6% FLF. The region is seeing strong competition from other regions’ carriers, particularly on the Asia-Europe route, IATA said.
  • Latin American carriers, with a 2.8% market share, saw a 5.8% increase in traffic in July, as capacity grew 4.7%, resulting in a 30.6% FLF.
  • African carriers, with a 1.6% market share, produced the greatest statistical growth of all regions in July, with traffic demand increasing 33.7% on capacity growth of 4.5%, producing a 22.5% FLF. “African airlines’ freight volumes has been helped by a surge in traffic between Africa and Asia … FTKs flown on the route jumped by nearly 80% YOY in June and 65% in the first half of the year,” Oxley said.

Mark Nensel