Carriers on a high as air freight rates climb again – a rare March increase
The numbers have risen again: air freight rates enjoyed a 4% month-on-month rise in March, ...
The air freight market saw rare growth of more than 3% last year, according to figures released today.
IATA’s freight tonne kilometre (FTK) measure shows growth of 3.8% – nearly double the average rate of 2% over the past five years.
WorldACD shows chargeable weight growth at 3.1%, with direct tonne kilometres (DTK) up 3.4% in 2016.
And the consultant noted that, excluding Q1 – distorted by 2015’s transpacific boom caused by the west coast ports crisis – weight growth rose 4.4%, while DTKs grew 5.2%.
Q4 saw the best quarterly performance seen since 2010, with chargeable weight up 7.5% and DTKs up 8.3%.
WorldACD explained: “In other words, the average distance between origin and final destination of the shipments carried, increased slightly (DTK-growth outpacing weight growth).”
One of the key measures, yields, rose some 6% in Q4 16 over Q3 – a rise which was just 1% in the previous two years.
IATA shows all regions except Latin America seeing growth last year, with Europe’s airlines picking up nearly half the additional demand, the majority of which came in the second half after a weak first half.
In December, Europe’s carriers enjoyed a 16.4% rise in air freight demand against a capacity increase of 5.9%, while Asia Pacific airlines saw volumes grow 9.8%, year-on-year, while capacity grew 5.7%. North American carriers saw demand grow 3.7% while capacity fell 1.4%.
In the Middle East, where things are not as glowing as they once were, volumes rose 11.2% in December and capacity increased a (relatively) meagre 5.9%. Total demand for those carriers in 2016 rose 6.9% – the region’s slowest pace of growth since 2009 and well below the 12% average. IATA suggests the carriers lost volumes to Asia and Europe.
According to WorldACD, weighted average yields (including charges) for the year on westbound origin and destination routes fell $1.75, a drop of 12.5%. Easterly, it fell 15.5% to $1.63.
IATA attributed some of the overall growth in demand to a rise in shipments of silicon materials and greater export orders, plus an early Chinese new year holiday.
CEO Alexandre de Juniac urged airlines to become more competitive through digitisation, warning : “Looking ahead, strong export orders are good news. But there are headwinds. The most significant is stagnant world trade which also faces the risk of protectionist measures. Governments must not forget that trade is a powerful tool for growth and prosperity.”