The latest data has shown that global freight demand grew again in October but capacity still outstrips demand.
According to International Air Transport Association (IATA) analysis, demand, measured in freight tonne kilometers (FTKs), rose 3.1% in October 2018, compared to the same period the year before. This pace of growth was up from a 29-month low of 2.5% in September.
Freight capacity, measured in available freight tonne kilometers (AFTKs), rose by 5.4% year-on-year in October 2018. This was the eighth month in a row that capacity growth outstripped demand.
We must be conscious of the economic headwinds, but the industry looks set to bring the year to a close on a positive note
Growing international e-commerce and an upturn in the global investment cycle are supporting the growth.
However, demand continues to be negatively impacted by a contraction in export order books in all major exporting nations in October, longer supplier delivery times in Asia and Europe; and weakened consumer confidence compared to very high levels at the beginning of 2018.
“Cargo is a tough business, but we can be cautiously optimistic as we approach the end of 2018. Slow but steady growth continues despite trade tensions,” said Alexandre de Juniac, IATA's Director General and CEO.
“The growth of e-commerce is more than making up for sluggishness in more traditional markets. And yields are strengthening in the traditionally busy fourth quarter.
“We must be conscious of the economic headwinds, but the industry looks set to bring the year to a close on a positive note.”
All regions reported year-on-year demand growth in October 2018, except Africa which contracted.
Breakdown, by region:
- Asia-Pacific airlines saw demand for air freight grow by 1.9% in October 2018, compared to the same period last year. Capacity increased by 4.2%.
- North American airlines posted the fastest growth of any region in October 2018, with an increase in demand of 6.6% compared to the same period a year earlier. Capacity increased by 8.2% over the same period.
- European airlines experienced a 1.4% increase in freight demand in October 2018 compared to the same period a year earlier. Capacity increased by 1.9% year-on-year.
- Middle Eastern airlines’ freight volumes expanded 5.0% in October 2018 compared to the same period a year earlier. Capacity increased by 8.8% over the same period.
- Latin American airlines’ freight demand rose 0.3% in October 2018 compared to the same period last year and capacity increased by 3.3%. International demand slipped by 0.9%, marking the first contraction in 11 months.
- African carriers saw freight demand decrease by 4.2% in October 2018, compared to the same month last year. This was the seventh time in eight months that demand shrank. Capacity increased by 5.4% year-on-year.