Asia Pacific carriers handle slightly higher cargo in September

MANILA, Philippines - Asia Pacific-based airlines posted a minimal increase in air freight volumes as major economies in the region continue to suffer from poor trade growth, a report from the International Air Transport Association (IATA) said.

Latest data from IATA showed Asia Pacific carriers recorded an increase in freight ton kilometers (FTKs) of merely 0.3 percent in September while capacity expanded 2.1 percent.

Although second half 2015 data revealed declines in trade to and from Asia have bottomed out, IATA noted that conditions in the region remain fragile as China and other key export economies, including South Korea and Chinese Taipei, continue to record disappointing trade growth.

“Given that manufacturing activity and export orders remain weak in China, a strong acceleration in regional trade in the near-term is unlikely,” IATA director general and chief executive officer Tony Tyler said.

Meanwhile, global air freight volumes were slightly higher in September, one percent up compared to a year ago and a small improvement from August when volumes were broadly stable year-on-year. However, the increase is narrowly based and trade and business confidence remain weak in key regions.

“Despite the rise in demand in September, load factors showed no improvement and remain at lows not seen since 2009. In addition to recent weakness in cargo demand, there has been continued capacity expansion, partly from growth in the passenger business, and this has placed downward pressure on cargo load factors,” Tyler added.

Furthermore, airlines in the Latin American region reported a huge drop of 6.4 percent in September as economic and political conditions in key economy Brazil continue to worsen and air cargo demand is down 6.8 percent for the year with no sign of improvement in the months to come.

North American airlines experienced a decline of 3.3 percent year-on-year but possibility of improvements in air freight demand is seen as better economic conditions in the second half of 2015 are recorded.

“Some of the conditions that led to the decline in world trade this year – a combination of weaker than expected global economic growth, particularly in emerging markets, as well as shifts toward the domestic market in China – are persisting. The September data suggests that improvements in some regions could counter further declines in air cargo demand. But this is narrowly-based and the demand backdrop for air cargo remains fragile,” IATA said.

On the other hand, Middle Eastern carriers’ continued growth in air freight reaching 7.5 percent in September helped offset weakness in other regions and growth rates remain robust enough to sustain solid demand for air cargo.

European carriers, likewise, reported a rise in demand in September of 2.8 percent compared to a year-ago and capacity rose 7.7 percent on the back of recent improvements in euro zone manufacturing business activity.

African airlines which carry a small part of worldwide FTKs, recorded a 2.5 percent increase in September with regional trade activity supporting demand for air transport of goods.