Africa Records 1.2% Freight Growth

The International Air Transport Association (IATA) has released global freight figures showing that African airlines Freight Tonne Kilometres flown (ie. revenue-generating cargo flown) declined by 8.4 per cent in December although for 2015 generally, the region grew by 1.2 per cent.
Despite the general freight growth of 1.2 per cent, under-performance of the Nigerian and South African economies still posed a challenge throughout the year.
The Freight Load Factor (percentage of available capacity that was taken up by the market) in 2015 was 29.7 per cent, the lowest of any region.
“The under-performance 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 freight tonne kilometres (FTKs),” IATA noted.
Other global figures released by the world airline body, show that cargo volumes measured in FTKs expanded by 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.
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 director-general, Tony Tyler described 2015 as a difficult year for air cargo and enjoined all to adjust with the current trend of cargo growing in line with rates of economic expansion.
Tyler said,”2015 was another very difficult year for air cargo. Growth has slowed and revenue is falling. In 2011 air cargo revenue peaked at $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.”
Asia-Pacific carriers were basically flat in December, expanding just 0.1 per cent. 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 eight 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 airlines grew by 1.2 per cent in December but the performance for 2015 in total was a fall of 0.1% 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.
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.
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. 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.

Leave a Reply

Your email address will not be published. Required fields are marked *