JEDDAH — Middle Eastern carriers enjoyed the strongest growth for air cargo in any region, expanding 11.3 percent in December and 11.0 percent for the year as a whole, the International Air Transport Association said on Wednesday. Airlines in the region have extended their networks and grown capacity by 11.1 percent to make the Middle East a hub for freight traffic. In fact they have been responsible for over 37 percent of the total increase in global freight capacity in 2014. Global demand for air cargo rose 4.9 percent in December as growth accelerated, driven by an uptick in world trade, IATA said. IATA said demand growth of 4.5 percent for the full year, compared with 1.4 percent in 2013, was driven by the Asia-Pacific and Middle East regions. "Recent concerns over the health of the global economy and a corresponding fall in business confidence have not yet impacted air cargo. But it is a downside risk that will need to be watched carefully as we move through 2015," said Tony Tyler, IATA's Director General and CEO in a statement. Performance varied widely by region with the most significant growth being recorded by airlines in Asia-Pacific and the Middle East. All regions, with the exception of Latin America, reported a strengthening of demand in December. Asia-Pacific carriers grew 5.9 percent in December compared to December 2013, and 5.4 percent for 2014 as a whole. Volumes have benefitted from increasing import demand in addition to continuing manufacturing strength. Japanese and Chinese markets were particularly important contributors. Overall in 2014, capacity expanded 5.7 percent leading to a slight fall in load factor to 55.4 percent, although this remains the strongest load factor of any region. North American airlines reported demand growth of 2.8 percent in December and 2.4 percent for 2014 as a whole. After a slow, weather-affected start to the year, growth accelerated, driven by import and export demand. Carriers in the region cut back capacity in 2014 by 0.5 percent, helping to underpin the load factor (35.3 percent). European airlines saw FTKs expand 2.3 percent in December, and by 2.0 percent in 2014 overall. The Eurozone remains weak and close to recession, with the effects of Russian sanctions also having an impact. Load factors also fell in 2014 as capacity expanded 3.0 percent. Latin American airlines reported FTKs falling 4.5 percent in December. This was the only region to report a decline. The picture for 2014 as a whole was growth of 0.1 percent. Latin American volumes have been affected by economic slowdown across the region, particularly in Brazil and Argentina. Capacity grew by 0.3 percent in 2014. African carriers expanded FTKs by 12.2 percent in December and 6.7 percent for the year as a whole. Although major economies Nigeria and South Africa underperformed during parts of 2014, regional trade activity held-up, supporting demand for air transport of goods. Capacity rose just 0.9 percent for the year as a whole, helping to strengthen the load factor. Cargo innovation in Shanghai “Despite the improving growth trend, big challenges remain. Yields declined for the third straight year in 2014, with no immediate prospect of improvement. Cargo revenues remained basically unchanged at $62 billion, some $5 billion below their 2011 peak. To move forward, the industry is focusing on providing a stronger value proposition to meet evolving customer needs. That's what is driving efforts such as cutting shipping times, ensuring high-quality handling of temperature-sensitive goods, or benchmarking quality to improve customer transparency. It's all about delivering value as a supply chain with a strong vision of the future,” said Tyler. This focus on value is delivering change. For example, in 2014 electronic air waybill penetration reached 22 percent and airlines are targeting 45 percent penetration by the end of 2015. An initiative to encourage further industry innovations will take center stage at the World Cargo Symposium in Shanghai on March 10-12 with the launch of the Air Cargo Innovation Awards. “If you have a stake in air cargo, the World Cargo Symposium is the place to be in March as we lay the foundations to energize the sector, recapture market share and grow revenues,” said Tyler. — SG
