World air cargo volumes slump in June

World air cargo traffic suffered a downturn in June due to the worsening international economic climate, according to the latest figures from international aviation organisations. The figures follow recent comments by global express operators about weak demand in June.

The figures continue the general downward trend seen over the first half of 2008. The key factors include lower domestic volumes in the USA, lower US imports due to the country’s weak economy, and a partial modal shift from air to sea transport as customers seek to reduce overall logistics costs.

According to the Airports Council International (ACI), representing the majority of the world’s airports, total air freight volumes dropped by 3.2% to 4.6 million tonnes in June 2008 compared to the previous year. Domestic freight slumped by 10.9% while international volumes grew just 0.4%. Half-year volumes were up by just 2.2% at 28.6 million tonnes, with domestic cargo down 2.8% and international volumes up by a more healthy 4.7%, it said.

“The recent downward trend in air freight is very much linked to the price of oil and fuel. Domestically, air freight cannot compete with other transport modes such as road and rail,” ACI commented. The ACI figures are based on monthly airport data representing 70% of world air freight volumes.

In regional terms, North America saw a 10.9% volume drop in June, including a 14% fall in domestic volumes and a 3.2% decline in international freight. This left overall volumes down 3.6% over the first six months of 2008. Europe had a 1.3% drop in air cargo volumes in June, including a 1.7% fall in international volumes. Half-year volumes were up 2.9%.

Asia Pacific, the world’s largest air cargo market, saw growth slow to just 1% in June, with international cargo growth at 2.5%. The region had 6.6% overall growth in the first half-year. Smaller markets such as Middle East and Latin America also saw low growth in June.

Separately, IATA, representing the world’s commercial airlines, said that international cargo traffic contracted by 0.8% in June. This was the first monthly decline since May 2005 and followed several months of falling manufacturing sector confidence indicators.

“The global economic turbulence clearly shows in the 0.8% drop in freight volumes compared to last year. Although the passenger demand grew by 3.8%, this is the slowest growth that we have seen since the industry was hit by the SARS crisis in 2003. With consumer and business confidence falling and sky-high oil prices, the situation will get a lot worse,” said Giovanni Bisignani, Director General and CEO of IATA.

Asia Pacific airlines led the freight contraction with a -4.8% year-on-year decline for June traffic, IATA pointed out. European carriers saw freight demand growth fall to 0.7% in June from 1.4% in May. North American carriers also saw freight demand growth slow to 4.0% in June from 4.6% in May.

Middle Eastern carriers delivered the strongest performance with 12.1% growth (up slightly from the 10.7% recorded in May). Latin American airlines recorded the largest contraction (12.7%) as the region’s cargo sector continues to re-structure its capacity.