Airfreight growth has improved on a year ago, supported by the cyclical upswing in the global economy, but high jet fuel prices and weakness in yields continue to place downward pressure on revenue, according to the latest quarterly cargo analysis of the International Air Transport Association.
The IATA said consumers in Europe and the U.S. are becoming increasingly more confident, which has supported growth in demand for air-freighted commodities like semiconductors.
“However, recent developments in the demand environment suggest that growth could weaken in months ahead. Business confidence has flattened and world trade volumes have started to decline,” warned the organization in its “Cargo E-Chartbook: Q2 2014” released this month.
It continued: “Moreover, growth in world trade may be limited by the trend toward on-shoring of production. Jet fuel prices have been stable, but remain high and yields are down on a year ago, continuing to put on strain on financial performance. As new aircraft deliveries come into service in 2014, there could be further downward pressure on yields.”
On airfreight rates, the paper said prices are stable but continue to show contraction on a year ago. “By contrast, the decline in sea freight rates appears to be accelerating again, and levels are significantly down on a year ago.”
Demand for container shipping was noted to be strongest in the Americas and Asia. But despite some growth in the Eurozone economy over recent months, demand for Asian goods moved by air has remained stable. There has been no growth on this key airfreight market when compared to the pre-crisis peak, said IATA.
Consistent with recent weakening in demand, heads of cargo surveyed in April 2014 expect slower growth in traffic volumes over the next 12 months compared to the January 2014 survey, it added.
Photo: Aero Icarus
