Middle Eastern airlines witness sharp growth in freight in May

Middle Eastern carriers, which include three major Gulf airlines, witnessed a double-digit growth (year-on-year) in freight volumes, registering 10.2 percent increase in May 2017. This was a sharp jump from the 3.1 percent dip in April.The recent swings in the growth rate appear to be mainly a reflection of the more volatile monthly data last year. Capacity increased by 1.7 percent. Seasonally-adjusted freight volumes maintained their upward trend. Demand between the Middle East and Europe remains strong, increasing 19 percent so far this year but traffic to Asia has weakened, growing by just over 1 percent, latest statistics released by International Air Transport Association (IATA) show.According to IATA, which represents some 275 airlines comprising 83 percent of global air traffic,  global air freight markets showing that demand, measured in freight tonne kilometers (FTKs), grew 12.7 percent in May 2017 compared to the year-earlier period. This was up from the 8.7 percent annual growth recorded in April 2017 and is more than three times higher than the five year average growth rate of 3.8 percent.Freight capacity, measured in available freight tonne kilometers (AFTKs), grew by 5.2 percent year-on-year in May 2017. The continued growth of air freight demand is consistent with an improvement in world trade. This, in turn, corresponds with new global export orders remaining close to a six-year high in May. There are, however, some signs that the cyclical growth period may have peaked.The global inventory-to-sales ratio, for example, has started rising. This indicates that the period when companies look to re-stock inventories quickly, which often gives air cargo a boost, has ended.  Regardless of these developments, the outlook for air freight is optimistic with demand expected to grow at a robust rate of 8 percent during Q3 2017. “May was another good month for air cargo. Demand growth accelerated, bolstered by strong export orders. And that outpaced capacity growth which should be positive for yields. But the industry can’t afford to rest on its laurels. With indications that the cyclical growth period may have peaked, the onus is on the industry to improve its value proposition by accelerating process modernization and enhancing customer-centricity,” said Alexandre de Juniac, IATA’s Director General and CEO.All regions, with the exception of Latin America, reported year-on-year double-digit increases in demand in May 2017. Asia-Pacific airlines’ freight volumes expanded 11.3 percent in May 2017 compared to the same period a year earlier and capacity increased by 6.2 percent.Demand growth has been strongest, between 13-15 percent, on international routes within Asia as well as between Asia and Europe.Seasonally-adjusted volumes are now 3 percent above the volumes reached following the 2010 post-global financial crisis bounce-back

 

Source: Civil Aviation Authority, Qatar