IATA: Airfreight records slowest pace of FTK growth in 22 months in Mar-2018

    IATA reported (02-May-2018) global freight traffic (FTKs) increased 1.7% year-on-year in Mar-2018, the slowest pace of growth in 22 months, while AFTKs increased 4.4%, marking the first time capacity growth outpaced demand in 20 months. A slowdown in demand growth was recorded in all regions except Latin America, mainly due to the end of the inventory restocking cycle, “which helped air freight to grow more than twice as fast as wider global goods trade in 2017 [and] now looks to have run its course”. The FTK growth slowdown is consistent with recent reports of “broad based softening in new export orders in recent months”, with US, Japan and Germany based manufacturers reporting decreased year-on-year export orders growth in 2018 and South Korea and mainland China manufacturers reporting decreases in export orders. IATA noted: “The softening is likely to have been compounded, at least in part, by the increasing concerns of a trade war between China and the US”. Regional details include:

    • Africa: 3.4% decrease in FTKs in Mar-2018 may be attributable to the unusually strong result in Mar-2017 rather than a decline in recent performance or the start of a negative trend in the region;
    • Asia Pacific: Significant slowdown in international FTKs with recent declines in Japan and South Korea export orders while exposure to risks from protectionist measures remain disproportionately high;
    • Europe: Modest FTK growth reflecting a stronger euro and a softening of export orders in Germany;
    • Latin America: Solid growth and the sole region to record improvement from Feb-2018, partly reflecting improved economic outcomes in Brazil;
    • Middle East: Modest growth consistent with general performance in recent months but possibly attributable to the unusually strong Mar-2017 result;
    • North America: Solid growth and continued FTK improvement on North AmericaSouth America routes but the rising US inventory to sales ratio in 2018 likely means the boost to freight growth from restocking is over. [more – original PR]