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IATA predicts air cargo demand to rise 3pc in 2016 as 5.3 million tons lifted

THE International Air Transport Association (IATA) is forecasting that the industry will generate total net profits of US$36.3 billion in 2016.

Revenues are expected to rise by 0.9 per cent year on year to $717 billion in 2016, wholly due to the contribution of the passenger side of the business. Cargo revenues are expected to decline slightly to US$50.8 billion.

However, demand for air cargo is expected to accelerate in 2016 to three per cent, ahead of the 1.9 per cent growth in 2015. In total, the industry is expected to uplift 52.7 million tonnes of cargo in 2016.

The strengthening industry performance is being driven by low oil, stronger demand for passenger travel, stronger economies and increased efficiency as shown by high load factors, reported the Borneo Post.

IATA also announced a revision to its airline industry outlook for 2015 upwards to a net profit of $33 billion from the $29.3 billion forecast in June.

Industry revenues stood at $710 billion in 2015 due to the impact of the strengthening of the US dollar on non-dollar revenues.

The Asia Pacific region is said to be on the front line for the impact of continued weakness in cargo revenues.

Passenger capacity growth is expected to accelerate from six per cent in 2015 to 8.4 per cent in 2016 as new aircraft are delivered largely to accommodate growth in the major emerging markets of India, Indonesia and China.