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April 2017 IATA Air Freight Market Analysis 
Strong start to 2017, but have we passed the cyclical growth peak?


Growth eases back in April, but remains robust

Global FTKs grew by 8.5% year-on-year in April, down from 13.4% in March. Industry-wide FTKs have now grown by 9.3% in annual terms so far this year to date. Adjusting for the extra day in February 2016 owing to the leap year, this is equivalent annual growth of just over 10%. Airlines registered in Asia Pacific and Europe accounted for more than 70% of the annual increase in freight volumes, with North American airlines accounting for much of the rest. Middle Eastern and African airlines contributed positively, but Latin American carriers detracted from annual FTK growth for the 25th time in 27 months.

The upward seasonally adjusted trend has slowed

As we noted last time, developments in SA terms are not quite as strong as the annual growth rate would suggest. Indeed, as was the case last month, around two-thirds of April’s year-on-year FTK growth rate relates to gains that took place during the second half of last year. In fact, while industry-wide FTKs trended upwards at an annualized rate of more than 12% in the second half of 2016, the annualized trend growth rate has slowed to around 4% since the end of last year.


A solid backdrop for freight in Q2 2017…

To be clear, this is still a relatively solid rate of growth. Indeed, it is slightly ahead of the average pace seen over the past five years (3.5%). Moreover, business indicators continue to offer encouragement: the new export orders component of the global purchasing managers’ index (PMI) remains close to a six-year high, and indicative of healthy export order books for global manufacturers. At current levels, the measure is consistent with year-on-year FTK growth remaining in the region of 7.5% for the remainder of Q2 2017.


Highlights of the April 2017 Air Freight Market Analysis

  • Global freight tonne kilometres (FTKs) grew by 8.5% year-on-year in April, down from 13.4% in March.
  • FTK growth has made a strong start to 2017, but the best of the cyclical upturn may be behind us. The upward trend in seasonally adjusted (SA) traffic has slowed to a 4% annualized pace since the end of last year.
  • Year-on-year growth in international FTKs slowed from March in all regions except Latin America.
  • Having outpaced capacity in H2 2016, demand has now trended in line with supply since the end of last year.  Download the full document here.

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