The International Air Transport Association (IATA) released data for global air freight markets showing that in August freight markets stabilised after two months of decline. Measured in Freight Tonne Kilometers, air cargo volumes rose 0.2 per cent compared to the same month a year ago. This is a modest improvement on July performance when freight demand contracted by 0.6 per cent year-on-year.

The results varied widely by region IATA said, with carriers in the Middle East reported the most significant growth (10.4 per cent) followed by African (2.3 per cent) and European airlines (0.7 per cent). The most significant negative impact on the global performance was by Asia-Pacific based airlines (-1.0 per cent); and those in North America (-3.3 per cent) and Latin America (-7.3 per cent). All regions reported capacity expansions ahead of growth in demand.

“After declines in June and July, signs of a stabilisation in air cargo are welcome. But all is not well,” cautioned Tony Tyler, IATA’s director general and CEO. “Total volumes are down 2.0 per cent compared to the end of 2014. And some of the key reasons for the earlier weakness – for example, downgraded growth expectations in emerging Asia, and the rebalancing of the Chinese economy toward domestic consumption – are still there. Even though world trade volumes have slightly picked up, the industry will have to work hard to match the strong finish to 2014.”

Regional analysis in detail

Asia-Pacific carriers saw a fall in FTKs of 1.0 per cent in August compared to August 2014, and capacity expanded 4.9 per cent. The contraction was less severe than in July (-2.0 per cent), although with the continued drop in export orders for Chinese manufacturing, it is hard to say if the decline has bottomed out.

European carriers reported a rise in demand in August of 0.7% compared to a year ago and capacity rose 3.9 per cent. Recent improvements in manufacturing business activity seem to be finally feeding through to support air freight demand.

North American airlines experienced a decline of 3.3 per cent year-on-year and capacity grew 4.4 per cent. Airlines in the region have experienced a significant fall in FTK volumes since the end of congestion at West Coast ports. More fundamentally any improvement in economic performance does not appear to be driving stronger air freight demand.

Middle Eastern carriers saw the strongest growth with demand expanding by 10.4 per cent and capacity rising 14.3 per cent. Although some economies in the region have suffered a slowdown in non-oil growth, overall expansion remains robust enough to sustain solid growth in air freight.

Latin American airlines reported a decline in demand of 7.3 per cent year-on-year, and capacity expanded 0.8 per cent. The large fall reflects the continued economic struggles of Brazil and Argentina, while regional trade activity has not created stronger air freight demand.

African carriers experienced growth in demand of 2.3 per cent and capacity rose by 10.6 per cent. Nigeria and South Africa, the largest economies in the region, have underperformed. Regional trade, however, has held up, and generated increases in air freight volumes.