Aircraft and transport. Iata: freight growth continues in July
Up 2.1% recorded last month
The International Air Transport Association (IATA) released data for global air freight markets showing that demand, measured in freight tonne kilometers (FTKs), rose 2.1% in July 2018, compared to the same period the year before. This was the slowest pace of growth seen since May 2016 and well below the five-year average growth rate of 5.1%.
Freight capacity, measured in available freight tonne kilometers (AFTKs), grew by 3.8% year-on-year in July 2018. This was the fourth time in five months that capacity growth outstripped demand growth.
While the temporary grounding of the Nippon Cargo Airlines fleet may have exaggerated a slowdown in growth at the beginning of July, there are three indications that slower growth will continue:
The inventory re-stocking cycle, which requires quick delivery to meet customer needs, ended at the beginning of the year.
There has been a broad-based weakening in manufacturing firms’ export order books. Specifically, export order books in Europe started weakening in February and have fallen in China and Japan in recent months.
Longer supplier delivery times are being reported by manufacturers in Asia and Europe, the top two global trading areas by volume. This typically means that they have less need for the speed afforded by air freight.
All regions reported year-on-year demand growth in July 2018, except Africa which contracted. All regions, except Africa and Latin America, reported that capacity growth exceeded growth in demand.
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