International air freight showed good growth in January with volumes going up by 9.1% in Januaryafter a revised 7.3% in December and 6.9% in November, according to the latest traffic figures from
IATA.Air freight in January was 39% above the low point reached at the end of 2009 and some 6% abovethe pre-recession peak of early 2008. However, it has fallen 2% since its May 2010 peak at theheight of the re-stocking bubble, the airline association announced.
The freight load factor stood at 49.2% for January and all regions reported levels relativelyunchanged from a year ago. The seasonally-adjusted freight load factor of 53% reported in Januaryis within a range of 52-54% since mid-2010, as demand and supply conditions are now stabilising,IATA explained.
Giovanni Bisignani, IATA’s Director General and CEO, said: “We begin the year with some goodnews. With most major indices pointing to strengthening world trade and economic growth, this ispositive for the industry’s prospects. But we are all watching closely as events unfold in theMiddle East. The region’s instability has sent oil prices skyrocketing. Our current forecast isbased on an average annual oil price of $84 per barrel (Brent). Today the price is over $100. Foreach dollar it increases, the industry is challenged to recover $1.6 billion in additional costs.Even with good news on traffic, 2011 is starting out as a very challenging year for airlines.”
Carriers in the world’s largest region for air freight, Asia Pacific, increased their Januaryfreight volumes by 6.4% year-on-year. While this growth is slightly lower than the 7.2% reportedfor December 2010, the freight volumes carried by airlines based in the region actually increasedby 2% during January alone. The growth in January takes the volume of air freight carried to 6%above the pre-recession peak level and 48% higher than the recession trough.
North American carriers showed a double-digit increase of 14.1% in January compared to theprevious year which was the highest growth of any region for that month. Since November last year,traffic volumes have grown by 11% and are now 10% above the pre-recession peak.
European carriers showed an 8.6% increase in traffic for January but the weaker economic climatein Europe continues to hold back freight traffic recovery for airlines in that region. Volumes arestill 11% below the pre-recession peak.
The 8.2% growth in passenger traffic in January shows a recovery from December’s slowdown (with5.4% growth) that was related to severe weather in Europe and North America which reduced totaltraffic by 1-2%.
“As if the rising price of oil was not challenging enough, governments are increasing the costof mobility with a growing contagion of taxes. In 2010 the industry was hit with billions ofdollars of new or increased taxes in the UK, Austria and Germany. Now we see South Africa andIceland planning increases. Governments need to improve their finances and restart their economies.Mobility is a catalyst for economic growth. Governments must understand that taxing air transportout of the range of price sensitive travellers and businesses makes very little economic sense,”said Bisignani.
IATA’s forecast for 2011 made in December 2010 anticipates an industry profit of $9.1 billion ora 1.5% net profit margin on $598 billion in revenues. This is based on an average annual oil priceof $84 per barrel, a demand increase of 5.3%, flat cargo yields and a 0.5% increase in passengeryields. IATA will revise this forecast on 2 March.
