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Markets eroding further as uncertainty grows ….

June 11, 2019 Cargo & Freight No Comments Email Email

For quite a while now, reading about world trade has not been an undivided pleasure for people working in air cargo. More and more, they notice pessimism, bleak outlooks, somber moods. The latest figures bear out that things don’t look up at all in their business. April 2019 was the first month in which all regions, without exception, were confronted with the growing impact of adverse market movements that started last September. For both incoming and outgoing air cargo, each region returned YoY volume figures worse than the first quarter of the year, underscoring the clear slow-down in global business:

Looking at the business one spade deeper, i.e. on the level from region to region, we saw some markets at least in which YoY-figures for April were better (less worrisome) than those for Q1. In this respect, we mention business from Africa to Asia Pacific and to the Americas, as well as business from Central & South America (C&S Am) to North America and to the Middle East & South Asia (MESA).

We noticed another development which merits some attention. In the regions Africa, MESA and North America, the YoY figures for traffic within the region were slightly better in April than in Q1. This development contributed to the fact that, for the first month in a long period, DTK’s (Direct Ton Kilometers) dropped more than volume (-6.7% vs. -6.4% YoY). In other words, the average distance over which shipments were carried, got shorter in April.

But there is no denying that the bigger air cargo regions are hit hardest in the uncertain times we live in. Traffic from Asia Pacific to Africa grew, but that hardly offers consolation to the Asia Pacific market. Europe and North America, as well as MESA, were even denied such a small glimmer of hope. The contraction of business from these areas was shown in negative percentages not seen for years. And adding insult to injury, the trend in worldwide yields further contributes to worsening results for airlines. Whilst yields (measured in USD) grew by 11% from 2017 to 2018, they have fallen by 5% from Jan-Apr 2018 to Jan-Apr 2019. And their YoY decline is growing by the month…

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