Monthly Freight Growth Remains Well Below Average

Monthly Freight Growth Remains Well Below Average

Middle Eastern carriers’ freight volumes grow 3.8% in June

Middle Eastern carriers' freight volumes grew 3.8% in June. This was an improvement on the May figure of 2.7%. However, these figures are well below the average five-year rate of 9.5%. Capacity increased 4.5%.

Growth for first half of 2018 was 4.3% year-on-year, and the expectation is for volume growth to remain modest in the months to come.

Overall, global air freight markets showing that demand, measured in freight tonne kilometers (FTKs), rose 2.7% in June 2018, compared to the same period the year before. This continues the slowdown in air cargo growth that began earlier in 2018.

Growth for the first half of 2018 stands at 4.7%, less than half the growth rate in 2017.

End of the retestocking cycle, along with structural slowdown in global trading conditions have dampened growth. The Purchasing Managers Index (PMI) is presently at its lowest level since 2016. Factory export order books have turned negative in China, Japan and the US.

Middle East Freight Volumes Up by 7.3% in April

Alexandre de Juniac, IATA’s Director General and CEO, said: “Air cargo continues to be a difficult business with downside risks mounting. We still expect about 4% growth over the course of the year. But the deterioration in world trade is a real concern.

“While air cargo is somewhat insulated from the current round of rising tariff barriers, an escalation of trade tension resulting in a ‘reshoring’ of production and consolidation of global supply chains would change the outlook significantly for the worse.

“Trade wars never produce winners. Governments must remember that prosperity comes from boosting their trade, not barricading economies.”

Read More: Middle East Air Cargo volumes slow down in January

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