AAPA: Asia Pacific airfreight momentum suggests strong second half

The Asia-Pacific airfreight market is still red hot, and the latest numbers from the Association of Asia Pacific Airlines (AAPA) show that despite an increase in offered freight capacity of 4.8 percent in June, load factors for the month rose 3.1 percentage points to 66.2 percent.

Preliminary freight tonne kilometer (FTK) gains of 10 percent for the month of June showed “robust growth” in demand for international air cargo, prompting AAPA Director General Andrew Herdman to predict “further growth in the second half of the year, given signs of ongoing positive momentum in the global economy.”

Herdman explained that, “Global trade activity has picked up markedly since the middle of last year, with airfreight volumes growing at a robust pace.”

Asian airlines reported a 10.4 percent increase in international air cargo traffic volumes during the first half of 2017, which Herdman attributed to an “upswing in export orders for both the leading emerging markets and advanced economies.”

While Herdman’s optimism is in line with market indicators, others have warned that manufacturing cycles could soon peak, with indicators that inventory levels are reaching the point where demand for time-sensitive shipping falls.

These warnings, repeated every quarter, have yet to portend any real-world occurrences, and with e-commerce muddying the picture, the amount of inventory that retailers keep on hand to fulfill consumer demand is just one area in which the market is evolving. Airfreight is increasingly moving into the business-to-consumer side of the market, whereas in the past, carriers were mostly responsible for keeping retailers in stock.