IATA: Air freight volumes boosted by cyclical and one off factors over 2016

IATA reported (27-Jan-2017) air freight volumes have been outperforming world trade. For the 11 months to Nov-2016, worldwide FTKs rose almost 7% year-on-year a "which is a very strong outperformance over other modes of transport, since overall world trade volumes were up only 1.5% over the same period". IATA attributed this performance to a number of factors:

• A lack of demand for bulk commodities from Chinese construction has keeping overall shipping volumes lower;
• The cyclical fall in business inventories compared to sales, which typically causes firms to replenish inventories by air;
• The growth of e-commerce and the strength of certain sectors, such as pharmaceuticals, that typically ship product by air.
• Several one-off factors, including the Hanjin Shipping bankruptcy in Aug-2016 possibly diverting cargo to air temporarily, and the Samsung Galaxy S7 worldwide recall and replacement.

IATA cautioned the air freight outperformance may not be repeated, unless the growth of anti-trade sentiment is appropriately opposed. [more - original PR]