Middle East, Europe see highest cargo growth
The strengthening of air cargo markets that began in the second half of 2013 continued in February, according to the International Air Transport Association.
Freight demand rose 2.9 percent in February year over year. The first two months of 2014 have seen an overall 3.6 percent improvement in demand over the previous year.
“Cargo has had a positive start to the year. There is good cause for measured optimism for the cargo industry’s prospects in 2014. The 3.6% growth in demand recorded over the first two months of this year is a significant step up from the 1.4 percent growth in demand over the whole of 2013,” Tony Tyler, IATA’s director general and CEO, said. “There are, however, some serious trends which are not in the industry’s favor. Companies continue to on-shore their manufacturing supply chains. The world’s top 20 economies implemented some 23 percent more protectionist measures last year than in 2009. These factors are a major part of the reason why we are not seeing trade growth of 5-6 percent, which we would expect to see at the current level of domestic production. Currently trade and domestic production growth is running at about the same level. The World Trade Organization’s agreement in Bali late last year gives hope for invigorated world trade. It’s important that governments keep their commitments.”
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The vast majority of the growth in cargo was realized by airlines in the Middle East and Europe, who recorded 11.9 percent and 5.5 percent growth respectively compared to the previous February.
- Asia-Pacific carriers grew just 0.1 percent in February. As in 2013, the effect of the Chinese New Year, which fell on Jan. 31, may have dampened demand a little in February. Regional trade growth in recent months has been improving, so stronger airfreight growth should be posted in the months ahead. But Chinese economic performance may be on the verge of a slowdown, which would restrict trade and freight demand. Capacity grew faster than demand at 3.9 percent.
- North American airlines experienced a slight contraction of 0.3 percent year over year. But February business indicators in the manufacturing sector were close to a three-year high, suggesting that growth in exports and air cargo demand should resume. Capacity fell 1.9 percent, which helped shore up the load factor to 35.1 percent.
- European carriers have seen a steady increase in demand since mid-2013. The February year-over-year growth rate was only slightly down from the 5.8 percent recorded in January. Business activity indicators are at their highest since 2011, and trade is growing particularly strongly in central and Eastern Europe. Capacity was up 1.7 percent.
- Middle Eastern carriers continue to record double-digit growth in freight volumes. Airlines in the region are benefitting not only from the stronger growth in developed economies but also from expanding trade with emerging economies. Capacity grew slower than demand by 9.2 percent.
- Latin American airlines saw solid 6.1 percent growth in February, continuing a trend that started in the second half of 2013. Indicators for Latin America as a whole are positive. Even the weakness in the region’s largest economy, Brazil, is expected to get a boost from the upcoming FIFA World Cup. Capacity in the region grew just 1.7 percent.
- African airlines’ freight volumes fell 5.2 percent, continuing the weakness that has been apparent in the continent since the fourth quarter of 2013. African freight volumes are often volatile month to month, but carriers have seen downward pressure on demand from the slowdown in major regional economies, particularly South Africa. Capacity grew 5.5 percent.