The International Air Transport Association (IATA) released figures for global air freight markets showing cargo volumes measured in freight tonne kilometers (FTKs) expanded 2.2 per cent in 2015 compared to 2014. This was a slower pace of growth than the 5.0 per cent growth recorded in 2014. The weakness reflects sluggish trade growth in Europe and Asia-Pacific, IATA said.
After a strong start, air freight volumes began a decline that continued through most of 2015, until some improvements to world trade drove a modest pick-up late in the year, IATA noted. Cargo in Asia-Pacific, accounting for around 39 per cent of freight traffic, expanded by a moderate 2.3 per cent.
The key markets of Europe and North America, which between them comprise around 43 per cent of total cargo traffic, were basically flat in 2015. Latin America suffered a steep decline (-6.0 per cent) while the Middle East grew strongly, up 11.3 per cent. Africa also saw modest growth of 1.2 per cent.
The freight load factor (FLF) was at times the lowest for some years, falling to an average 44.1 per cent compared to 45.7 per cent in 2014, driven down by weak demand and capacity expansion.
Commenting on the year, Tony Tyler, IATA’s director general and CEO said: “2015 was another very difficult year for air cargo. Growth has slowed and revenue is falling. In 2011 air cargo revenue peaked at US$67 billion. In 2016 we are not expecting revenue to exceed $51 billion.
“Efficiency gains are critical as the sector adjusts to shortening global supply chains and evermore competitive market conditions. We have to adjust to the ‘new normal’ of cargo growing in line with general rates of economic expansion. The industry is moving forward with an e-freight transformation that will modernize processes and improve the value proposition. The faster the industry can make that happen, the better,” Tyler added.
Regional analysis in detail
The global freight growth rate in December was 0.8 per cent compared to December 2014. Within that range there were considerable regional fluctuations.

• Asia-Pacific carriers were basically flat in December, expanding just 0.1 per cent, while for the whole of 2015, the region grew 2.3 per cent. The FLF for 2015 was 53.9 per cent, the highest of any region. Cargo expansion in the region has been hampered by a shift in Chinese economic policy to favour domestic consumption. A mid-year fall of 8.0 per cent in trade to/from emerging Asia also led to declines but this appears to have bottomed out, with a rebound in the second half of the year.

• European airlinesgrew by 1.2 per cent in December but the performance for 2015 in total was a fall of 0.1 per cent compared to 2014. The FLF in 2015 was 44.9 per cent. Economic conditions in the Eurozone have been subdued, leading to suppressed demand for air freight, but imports have improved in recent months.

• North American airlines saw FTKs expand 1.4 per cent in December compared to December 2014. For the year as a whole, North America grew just 0.1 per cent and the 2015 FLF was 34.3 per cent. Growth in 2015 faded after a strong start that was flattered by the West Coast ports strike. Recently there have been mixed signals from economic data, indicating an uncertain outlook for air freight in the coming months.

• Middle Eastern carriers grew 4.0 per cent in December and for 2015 in total the region expanded 11.3 per cent compared to 2014. The FLF was 42.8 per cent for 2015. The region enjoyed a strong year as network expansion into emerging markets was supported by economic growth in local economies. Political instability and the fall in the oil price may impact on some economies in the region but growth as a whole remains robust enough to support further expansion in 2016.

• African airlinesFTKs declined by 8.4 per cent in December although for 2015 as a whole the region grew by 1.2 per cent. The FLF in 2015 was a meagre 29.7 per cent, the lowest of any region. The underperformance of the Nigerian and South African economies was a challenge throughout the year, but trade growth to and from the region was sufficient to drive a modest expansion in FTKs.

• Latin American carrierscontinued the weak performance of recent months, declining by 6.2 per cent in December and by 6.0 per cent for 2015 as a whole, making this the weakest performance of any region. The average FLF for 2015 was 38.3 per cent. Economic and political conditions in Brazil have worsened, and regional trade activity has been volatile.

The industry’s key challenges will be discussed in detail at the World Cargo Symposium (WCS) in Berlin, 15-17 March. The world’s largest gathering of air cargo professionals, the 10th WCS will bring together 1,000 delegates under the theme of ‘The Value of Air Cargo’ to debate solutions for strengthening air cargo and the vital service it performs for the world economy.