Global air freight demand increased 0.1% in March 2019 year-on-year, with all regions posting growth except Asia-Pacific which contracted, according to data from the International Air Transport Association (IATA).
While the slight global demand growth is a significant improvement on the 4.9% contraction in February, in seasonally adjusted terms, demand is still down 1.5% over the past year, IATA said.
Freight capacity rose by 3.1% year-on-year in March 2019. Capacity growth has now outstripped demand growth for 11 out of the last 12 months.
IATA said significant headwinds are facing demand. These include global trade volumes that have fallen by 1% over the past year, and global economic activity and consumer confidence that continue to weaken.
Moreover, the export order component of the global manufacturers’ Purchasing Managers Index has indicated falling global export orders since September 2018.
However, industry confidence regarding the outlook remains relatively upbeat with only 13% of respondents from IATA’s business confidence survey expecting to see a decrease in freight volumes in 2019 compared to 2018.
“Year-on-year demand for air freight edged back into positive territory in March with 0.1% growth. After four consecutive months of contraction, this is an encouraging development. But the headwinds from weakening global trade, growing trade tensions and shrinking order books have not gone away,” said Alexandre de Juniac, IATA’s director general and CEO.
Only Asia-Pacific saw demand contract in March, shrinking by 3.4% compared to the same period in 2018. This was a significant improvement from the 12.0% decline in growth from the previous month.
“Weaker manufacturing conditions for exporters in the region, ongoing trade tensions and a slowing of the Chinese economy impacted the market,” said IATA.
North American airlines saw demand increase by 0.4% in March 2019 year-on-year. Despite the small increase, new export orders are rising which would support air cargo growth, said the report.
European airlines posted a 3.6% increase in freight demand in March 2019 year-over-year. Given the weaker manufacturing conditions for exporters in Germany, and uncertainty over Brexit, March’s performance represents a positive outcome.
Middle Eastern airlines’ freight volumes increased 1.3% year-on-year in March 2019. A clear downward trend in seasonally adjusted international air cargo demand is now evident with weakening air freight volumes to/from North America and to/from Asia-Pacific contributing to the softer performance.
Latin American airlines experienced an increase in freight demand growth in March 2019 of 3.6% compared to the same period last year. Nevertheless, ongoing economic and political uncertainties in various parts of the region continue to present challenges for the industry.
African carriers posted the fastest growth of any region in March 2019, with an increase in demand of 6.0% compared to the same period a year earlier.
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