Air freight demand down just 1.1% in November

Performance was the best in eight months, with the slowest year-on-year rate of contraction recorded since March 2019 – in part, reflecting the growing importance of large e-commerce events such as Singles Day in Asia and Black Friday.

New figures from the International Air Transport Association (IATA) indicate that global air freight demand was down just 1.1% in November, year on year, the smallest decline since March, raising hopes that the downturn in the sector is coming to an end.

Although the 1.1% fall in flown freight tonne kilometres (FTKs), compared to the same period in 2018, marks the thirteenth consecutive month of year-on-year declines in freight volumes, November’s performance was the best in eight months, with the slowest year-on-year rate of contraction recorded since March 2019.

In part, November’s outcome reflects the growing importance of large e-commerce events such as Singles Day in Asia and Black Friday, IATA noted, adding: “While international e-commerce continues to grow, overall air cargo demand continues to face headwinds from the effects of the trade war between the US and China, the deterioration in world trade, and a broad-based slowing in global economic growth.”

Air freight capacity, measured in available freight tonne kilometres (AFTKs), rose by 2.9% year-on-year in November 2019. Capacity growth has now outstripped demand growth for 19 consecutive months.

Last month, IATA said it was optimistic of a return to air freight growth in 2020, forecasting a 2% recovery in demand this year following an estimated 3.3% decline in traffic in 2019 – the steepest drop since 2009 during the Global Financial Crisis. The association predicted that freight tonnes carried are expected to recover to 62.4 million in 2020, a 2% increase over 61.2 million tonnes carried in 2019, which was the lowest figure in three years.

Alexandre de Juniac, IATA’s director general and CEO, commented: “Demand for air cargo in November was down 1.1% compared to the previous year. That’s better than the 3.5% decline posted in October. But it is a big disappointment considering that the fourth quarter is usually air cargo’s peak season. Looking forward, signs of a thawing in US-China trade tensions are good news. But trading conditions at present remain very challenging.”

Source: Lloyd’s