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Middle Eastern carriers ...... double-digit growth.

ME carriers driving global air freight growth

GENEVA, December 3, 2014

The international air freight market continued to deliver a robust performance in October led by the Middle Eastern carriers which recorded a 13 per cent growth in cargo demand compared to last year, said a report.

Middle Eastern carriers once again recorded double-digit increases as they expanded their services in perishables and linked growing markets in Asia and Africa, according to data released by The International Air Transport Association (IATA) for October.

The capacity of the regional carrier expanded 15.8 per cent, it added.

Globally, the demand, measured in freight tonne kilometers (FTK), rose 5.4 per cent in October compared to last year. This out-stripped capacity which grew by 4.4 per cent.

Compared to September demand grew by 0.7 per cent bringing freight volumes to a new record monthly high, said the report.

IATA said the good results reflected the improvements in world trade and business activity which have been evident since the summer. "World trade is growing steadily, supporting increased air cargo shipments. Regional differentiation in performance, however, is very apparent, it added.

Commenting on the performance, Tony Tyler, the director general and CEO, said: "We are now back to levels of demand not seen since the 2010 post-recession bounce-back. But the industry is still in the hot seat and under pressure to improve its value offering."

"Customer expectations have evolved dramatically. Other modes of cargo have improved their competitiveness. Shippers expect the efficiency of electronic processes that they experience in almost every other sector," stated Tyler.

"And when shipping specialty products - such as those requiring cold chain control - they expect quality from end-to-end. The industry is investing to build its future by meeting these expectations," he added.

According to Tyler, the carriers in the Middle East, Africa and Asia-Pacific saw demand grow faster than the global trend, while North America, Europe and Latin America grew more slowly.

More significantly, however, carriers in all regions except for Europe improved on their year-to-date performance. Cargo demand for European carriers grew by a weak 1.4 per cent compared to the previous October, reflecting economic uncertainty and the impact of sanctions as a result of the Russia-Ukraine crisis, he added.

The Asia-Pacific carriers reported a 6.7 per cent increase in FTKs, boosted by the release of the iPhone 6, and solid increases in trade and exports from emerging Asian economies.

Looking forward, the rate of growth in the Chinese economy continues to slow down which may impact on air cargo. Capacity grew 5.7 per cent, it added.

The global aviation body said European airlines improved cargo volumes by 1.4 per cent.

"The Eurozone economy only just avoided recession in the third quarter. Poor business confidence and the ongoing sanctions against Russia will continue to weigh on European cargo in the months ahead. Capacity expanded 4.4 per cent, observed Tyler.

North American carriers recorded an increase of 3.1 per cent in October. Growth was slower than the September figure of 5.4 per cent, but the overall trend is showing an acceleration on growth for the year-to-date (2.7 per cent).

Underlying indicators are positive, which bodes well for increased cargo growth in the future. Capacity contracted 1.2 per cent.

On the Latin American performaance, IATA said the airlines grew FTKs by 4.1 per cent year-on-year. This solid growth reverses the trend from September, when volumes fell 0.7 per cent. Stronger export growth across Latin America is supporting better air cargo performance. The capacity too grew 2.3 per cent.

The African airlines reported strong growth of 9.6 per cent year-on-year, said the report from IATA.

The regional trade volumes are still volatile, but the improvement in key economies such as South Africa is supporting this improvement, it added.-TradeArabia News Service




Tags: Middle East | growth | air freight |

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