News

Strong Growth in Global Air Freight

Strong Growth in Global Air Freight

News within the market for worldwide air freight remained strong this month as, once again, the percentage increase in volume sent exceeds double digits, compared to the amount sent this time last year. Worldwide tonnage shipped saw an increase of 12.9% YoY to August 2016. WorldACD’s DTK (Direct Tonne Kilometre) hit a whopping 14.6%.

Alongside this, prices or “yields” also increased by 10%, making the value of all shipments being sent far greater than last year's results. Findings also show that the average distance for a parcel from origin to destination has increased, alongside the average shipment size.

What does this mean in terms of finances?

Financially, as you’d expect, freight companies will have collectively seen an increase in total USD value of shipments by 23%. Per kilo sent, this means an increase in revenue of 15 cents. Freight companies may be shocked and impressed by these findings, and much of this success can be attributed to an increase in the strength of the euro to the dollar.

Which regions have benefitted most?

When looking closely at the data, it quickly becomes apparent that it is the European and Asia-Pacific regions which have received the best of this growth. These regions experienced more than 15% YoY growth, coming in ahead of North America, which saw stagnant growth in domestic air transport.

Due to declining business to Europe and the Middle East, Africa experiences a 4% contraction in growth YoY, but the same can’t be said for Indonesia and South America, which had YoY growth in August of 21% and 11%.

All expected major air cargo destinations, such as China, Germany, and the UK saw booming growth this year, but Australia, UAE, and France performed below the 2017 averages.

If we’re looking at nations who experienced the most growth, then those accolades would go to Belgium and Vietnam. Each had more than 25% growth YoY, due to growing pharma transport markets in Belgium and a boost in all sectors within Vietnam.

What sort of cargo is proving most popular?

As expected in our advancing digital world, high tech goods are those which outperformed others and grew by 18% compared to last year. Perishable goods weren’t far behind, having seen growth of 12.4%.

When taking a deeper look at the transport of perishables worldwide, it would appear that flowers saw major improvement, with 9.9% growth. Colombia to USA transport of such items is up 18%, but again, Africa seems to have suffered, with the Kenya to Netherlands route contracting by 1.6%. Worldwide shipments of fruits and vegetables are up 5.9% and fish and seafood is up 4.9%.

When analysing individual trade routes of specific products between specific countries, the overall picture is very promising. With fluctuations and political relations, it’s natural that certain industries will be hit more than others.

Here at Staples, we are well aware of this booming growth and have had the chance to expand our operations both in air freight and road freight. For this reason, we’re looking forward to finishing off 2017 on a high and pushing ahead with plans for 2018. If you have any needs for air freight, then get in contact today to see if we have any viable solutions to best suit your business.