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June 2019 IATA Air Freight Market Analysis
Air cargo volumes weaken further, outlook remains clouded


Highlights of the June 2019 Air Freight Market Analysis

  • Industry-wide freight tonne kilometres (FTKs) fell by 4.8% year-on-yearin June; the 8th consecutive month of negative annual growth.
  • The weakness in air freight volumes compared with a year ago remains broad-based across regions, with the largest falls coming from the Middle East and Asia Pacific. Africa was the only region to record positive year-on-year growth this month. 
  • Growth in industry-wide capacity lifted somewhat in June to a still moderate 2.6% year-on-year. The freight load factor is 3.5 percentage points lower than its level of a year ago.

Africa the only region with positive y-o-y growth
Despite its small share of the global market, Africa was the only region where international air cargo volumes were higher this month compared with their level of a year ago. International FTKs were up 4.3% year-on-year, with the latest route area data (May 2019) showing a strong, double-digit performance on routes between Africa and Asia in particular – up an even 12% year-on-year. At the same time, the African market has seen a strong increase in capacity, with AFTKs up 17% year-on-year – in stark contrast to the capacity developments in all other regions over this period.


Air cargo volumes weaken in June

Annual growth in air freight tonne kilometres (FTKs) declined by 4.8% in year-on-year terms in June, down from a fall of 3.5% in May. This marks the 8th consecutive month of year-on-year decline in air freight volumes.
    Over recent months, the seasonally-adjusted series (which removes the regular seasonal fluctuations in the data) showed signs of a stabilization in air cargo performance – indeed a modest upward trend had started to become apparent in the three months to May. This nascent recovery has been unwound in the latest data. 
    Additional tariff increases in the ongoing US-China trade dispute, which came into effect on 1 June are likely to have contributed to this month’s outcome, along with further signs of moderation in the global macroeconomic backdrop. 
    Looking at the first half of the year in aggregate, air freight volumes are 3.6 % lower than their level over the same period a year ago. As we noted recently, the outcomes over the year to date mean that our forecast for zero average growth in 2019 looks optimistic.
     Once again this month, the contribution to the weak year-on-year growth outcome was broad-based, with all regions apart from Africa (which accounts for just 1.7% of total global FTKs) in decline. 
    The main contributors continue to be the larger freight regions of Asia Pacific and North America which together account for around 3 percentage points of the current year-on-year decline.
    Highlighting the impact of the US-China trade dispute, over the first half of the year, US goods exports to China are down 18% compared with the first half of 2018 while goods imports from China are down more than 12% (Source: US BEA, census basis).
    Globally, the performance of world trade has continued to languish, slipping back into negative year-on-year growth in the latest available data (May). World trade volumes are currently 0.4% lower than a year ago.

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