ABU DHABI, UAE \u2014 The global economy seems to be getting its groove back.
\nDespite weak world trade, IATA\u2019s senior economist yesterday projected moderate acceleration in the global economy, with 2017 already off to a strong start in terms of air cargo volumes.
\nSpeaking at IATA\u2019s World Cargo Symposium in Abu Dhabi, George Anjaparidze said that the better performance of air cargo compared to world trade was explained by structural and cyclical factors in 2016 and this could be repeated in 2017.
\nIATA\u2019s senior economist, George Anjaparidze
\nOn the structural side, sectors that rely on air cargo performed better than those that rely on maritime trade. Anjaparidze cited the example of the Eurozone, where broadening of growth has been a key factor in explaining the stronger demand for imports carried by air.
\nThat had real implications for forwarders, carriers, and other stakeholders. In early 2017, IATA announced that European airlines posted a 7.6 percent annual increase in freight demand in 2016 and a capacity rise of 6.7 percent.
\nOn the cyclical side, Anjaparidze noted that improving conditions in in emerging markets, led by China, had helped boost demand for air cargo in the third and fourth quarters.\u00a0 Another factor that boosted air cargo demand in the fourth quarter was the lagged positive impact from the Hanjin disruption, which led to a portion of the high value and time sensitive goods initially held up at sea to be served by air. \u00a0\u201cAir cargo also serves as a solution in times of disruption,\u201d he said.
\nOverall, air cargo had a weak first quarter but recovered and grew in 2Q2016, continuing the upswing into the third and fourth quarters.
\nYet, Anjaparidze noted that capacity in 2016 outstripped demand, in part due to continued delivery of new passenger widebodys, where payload belly capacity grew at 3.6 times that of freighter capacity in the same year. The capacity challenge is made worse by rising in-service freighter capacity \u2013 as older freighters have been brought out of storage as they become more economic to operate with fuel prices below their recent 2014 highs.
\nAll things considered, IATA\u2019s economic projection for growth in the industry is one of cautious optimism, with \u201crisks tilting to the upside.\u201d This projection is substantiated by a strong US economy, resilient underlying drivers of air cargo, such as strong export orders and rising consumer confidence.
\nGlyn Hughes, IATA\u2019s global head of cargo, took the stage yesterday, as well, to present the year 2016 in review, during which air cargo decisively improved its performance, outpacing global growth.
\nHughes listed several key IATA developments, starting with cargo safety. IATA made safe transportation of volatile batteries a major platform over the year, engaging with partners and pressuring governments to enforce safety standards. Lack of regulation and enforcement in the lithium-ion battery supply chain poses serious security threats, IATA warned in a letter to Ministers of Trade, Industry and Transport, and Directors of Civil Aviation of the world\u2019s largest lithium battery manufacturing and export countries.
\nGlyn Hughes, IATA\u2019s global head of cargo
\nAnother important development Hughes highlighted was an IATA announcement in mid-2016 that it had joined forces with freight forwarding advocacy group FIATA to \u201creview, refine, and reengineer the current Cargo Agency Program to develop a new and modernized Program \u2013 IATA-FIATA Air Cargo Program (IFACP).\u201d Hughes noted that this cooperation was aimed at developing customer centric relationships \u2014 \u201cit\u2019s about bringing in the regions,\u201d he said.
\nIATA also advocated for the safe integration of drones and calling for regulatory alignment. The organization has worked to identify opportunities on the cargo side, such as last-mile deliveries.
\n\u201cWe need to come up with a program where they can safely integrate,\u201d Hughes said.
\nAt 48.5 percent e-AWB compliance, Hughes admitted that \u201cthe job is not quite half done.\u201d However, he noted that that percentage adds up to 640,000 shipments per month. He called for stakeholders to work towards this year\u2019s goal of 62 percent, pointing to the Middle East where penetration is at 74.3 percent.
\n\u201cThis is the example we will take on the road,\u201d Hughes said
\nThose interested in learning more about airfreight in 2017, should join us at Cargo Facts Asia in Shanghai, 25 \u2013 26 April. \u00a0To register, or for more information, go to\u00a0CargoFactsAsia.com
\n
\nSource: aircargoworld<\/p>\n","protected":false},"excerpt":{"rendered":"
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