This week, IATA released its market analysis report for 2018, which shows that traffic volumes measured in freight tonne kilometers (FTKs) were 3.5 percent higher in 2018, year-over-year, but were 0.5 percent lower in December, compared to the same month in 2017, representing the slowest annual growth rate IATA has reported since early 2016. In 2017, the annual growth rate was a roaring 9.7 percent.
The results solidify a theme apparent in carriers’ year-end results – that carriers should not expect the momentum of volume growth from 2017 and most of 2018 to be a continuing trend for in upcoming quarters.
IATA said that a more modest demand for air cargo capacity was expected by industry experts, who predicted a slow-down following the shippers’ restocking cycle, which helped to inflate demand in 2017. However, the organization once again cited the impact of the international trade environment, with tariffs serving to disincentivize demand and stunt demand growth.
Looking to 2019, IATA said it expects cargo volumes to rise at a slightly higher rate of 3.7 percent, fueled by growing demand for e-commerce services, but noted “at this stage, the risks to this forecast appear tilted to the downside.”