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Africa bucks freight capacity growth trend

20th July 2018

By: Marleny Arnoldi

Online News Editor

     

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Global air freight capacity growth outstripped demand growth for the fourth month in a row in May, the International Air Transport Association (Iata) reports.

Market demand, measured in freight tonne kilometres (FTKs), rose 2.4% year-on-year in May, slightly down from the 5.2% year-on-year growth recorded in April.

Freight capacity, measured in available FTKs, meanwhile, grew by 6.2% year-on-year in May.

“After a weak start to 2018, demand for global air freight has now resumed a modest upwards trend. “However, the rapid growth seen in 2017 is now over, with demand growing at a significantly slower pace in 2018.

“In Iata’s midyear industry outlook, 2018 freight growth was revised downwards to 4% from the previously forecast 4.5% in December,” the association said.

The three indications that growth will continue at a slower pace are that the restocking cycle, which required quick delivery to meet customer needs, is over; the new export orders component of the global manufacturing Purchasing Managers Index is at a 21-month low; and global trade appears to be softening as trade tensions increase.

“We still expect demand to grow, but those expectations are dampened with each new tariff introduced. Experience tells us that trade wars, in the long run, only produce losers,” Iata director-general and CEO Alexandre de Juniac says.

All regions except Africa reported an increase in demand growth in May.

Edited by Chanel de Bruyn
Creamer Media Online Managing Editor

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