IATA, the International Air Transport Association, has reported it is expecting a weak demand for air cargo during 2016 weak demand for air cargo with a falling commodity prices, a slowdown in China, and an expected US interest rate hike.
Julie Perovis, IATA senior economist stated “A tough global economic environment and feeble world trade have subdued air cargo demand. Industry sentiment also is worsening. A regular survey IATA conducts of industry chief financial officers and the heads of cargo operations has turned more negative throughout the year”
Ms Perovis continued by declaring that growth projections for the coming 12 months in relation to freight volumes are weak. The survey data also points to a forecast of yields declining more sharply than expected a few months ago. The substantial drop in oil prices since summer 2014 should protect air freight operators’ bottom lines from being hit.
Air cargo consultant WorldACD stated recently that though yields have fallen sharply, excluding fuel effects the global average price to ship a kilograms of goods has remained stable,. “The weakness in 2015 has been insufficient volume rather than adverse yield developments,” the Amsterdam-based consultancy declared.
IATA announced that air freight traffic has undergone a prolonged period of slow growth, far behind the rates of expansion passenger airlines have seen. Freight traffic volumes are now only around eight per cent higher than their pre-financial crisis peak in 2008. Over the same period airline traffic has grown 42%.Freight ton kilometers, a measure of air cargo shipments, are up 2.6% in this year’s first 10 months.