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IATA expects weak demand for air freight to continue into 2016
WEAK demand for air cargo, which has prevailed for much of the year, is expected to continue into 2016 with a slowdown in China, falling commodity prices and a half expected US interest rate hike, according to the International Air Transport Association (IATA).
"A tough global economic environment and feeble world trade have subdued air cargo demand,?said IATA senior economist Julie Perovic, reports the Wall Street Journal.
"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 Perovic said.
Projections for growth in freight volumes in the coming 12 months have softened. The survey data also points to a forecast of yields declining more sharply than expected a few months ago.
The sharp drop oil prices since mid-2014 should protect air freight operators' bottom lines from being hit, Ms Perovic said.
Though yields have fallen sharply, excluding fuel effects the global average price to ship a kilogramme of goods has remained stable, air cargo consultant WorldACD said recently. "The weakness in 2015 has been insufficient volume rather than adverse yield developments," the Amsterdam-based consultancy said.
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 per cent, Ms Perovic said.
Freight ton kilometres, a measure of air cargo shipments, are up 2.6 per cent in this year's first 10 months, IATA said.
"A tough global economic environment and feeble world trade have subdued air cargo demand,?said IATA senior economist Julie Perovic, reports the Wall Street Journal.
"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 Perovic said.
Projections for growth in freight volumes in the coming 12 months have softened. The survey data also points to a forecast of yields declining more sharply than expected a few months ago.
The sharp drop oil prices since mid-2014 should protect air freight operators' bottom lines from being hit, Ms Perovic said.
Though yields have fallen sharply, excluding fuel effects the global average price to ship a kilogramme of goods has remained stable, air cargo consultant WorldACD said recently. "The weakness in 2015 has been insufficient volume rather than adverse yield developments," the Amsterdam-based consultancy said.
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 per cent, Ms Perovic said.
Freight ton kilometres, a measure of air cargo shipments, are up 2.6 per cent in this year's first 10 months, IATA said.
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