International air cargo demand growth went down significantly from 8.7% in January to a 2.3%increase only in February, figures released by the International Air Transport Association (IATA)
today show.IATA said the political unrest in the Middle East and North Africa during February is estimatedto have cut international traffic by about 1%.
In addition to the political unrest, the dramatic fall in cargo growth was impacted partly byfactory shutdowns due to the Chinese New Year period which fell in the first part of February in2011.
Giovanni Bisignani, IATA’s Director General and CEO, commented: “Another series of shocks isdenting the industry’s recovery from the recession. As the unrest in Egypt and Tunisia spreadsacross the Middle East and North Africa, demand growth across the region is taking a step back. Thetragic earthquake and its aftermath in Japan will most certainly see a further dampening of demandfrom March. The industry fundamentals are good. But extraordinary circumstances have made the firstquarter of 2011 very difficult.”
February marked a decline in freight load factors deteriorating to 51.6%. This is 4 percentagepoints below its peak in May 2010, on a seasonally adjusted basis.
According to IATA, air freight volumes in February stood at the same level as the pre-recessioncycle peak in early 2008. But it was down almost 7% on the high reached in May 2010 at the peak ofbusiness re-stocking. “The industry’s fundamentals are strong. Business confidence, as measured bythe purchasing managers’ index, reached its second highest level ever in February,” theorganisation added.
In regional terms, Asia-Pacific carriers recorded an air freight decline of 4.5% in February.This reflects plant closures associated with Chinese New Year as well as the impact ofinflation-fighting measures in the Chinese economy. In terms of volumes, this had the largestimpact in slowing global growth to 2.3%, the weakest growth since the beginning of the thirdquarter in 2009 when annual growth rates turned positive again out of the recession.
North American carriers saw freight grow by 11.8%, slightly below the 12.1% increase in LatinAmerica.
European carriers showed weak growth of 6.3% in February, reflecting the region’s proximity andtrade connections with North Africa and the continuing weakness in the European economy.
Cargo carried by African carriers fell by 5.7% on the back of unrest in Egypt and Tunisia. Inabsolute terms, the freight carried by the region’s carriers fell by 8.4% in February compared toJanuary.
“The industry situation is volatile and we are watching higher fuel prices carefully. Capacityincreases ahead of demand are bringing down load factors for both passenger and cargo operations.Demand is still supported by strong economic fundamentals. But with looser supply and demandconditions, it will be a challenge for airlines to recover the added costs of fuel. Our pathetic1.4% expected margin for 2011 is under considerable pressure,” Bisignani said.
Based on an average oil price of $96 per barrel, IATA is forecasting fuel to account for 29% ofaverage operating costs with a total fuel bill of $166 billion. For every dollar increase in theprice of an oil barrel, the industry must recover an additional $1.6 billion in added costs.
