Global air freight weakened in March, offsetting signs of an upswing in demand towards the end of 2012, says the International Air Transport Association (IATA) in a new analysis.
Global freight tonne kilometres (FTKs) were down 2.3% year-over-year for the month of March, which is better than the 7.2% decline in February. Despite this, the trends show that growth has stalled when adjusting for seasonal factors, IATA says.
The weakened air freight market is reflecting uncertainty in the economy at large, IATA says. Factors such as lower-than-expected growth in China in the first quarter, declining confidence of firms in the Eurozone and sequestration cuts in the USA have impacted this trend.
"Although the improved business environment which supported the previous rise in volumes remains largely intact, recent developments in major economies have raised questions about the pace of the global economic recovery - air freight markets appear to be reflecting that same uncertainty," says IATA.
Although these factors persist, IATA forecasts that air freight demand will better in the next few months because of new export orders and signs of an upturn.
"Despite downward revisions to Eurozone growth and US government spending cuts, business confidence levels continue to indicate that a global economic upturn is forthcoming," says the report.
Operators in the Asia-Pacific region have felt the market weakness the most, with FTKs falling by 3.3% in year-over-year in March. The market has expanded slightly from February, but volumes have dropped 3% since January.
North American airlines saw a 5.2% decline in demand in March, and Europe's FTKs decreased by 4% year-over-year. Latin American airlines declined by 0.8% in March.
The Middle East and Africa were the only regions to see volumes increase in March, at a rate of 10.5% and 2.3%, respectively. These markets have been growing for the past two years because operators are expanding networks to reach emerging markets and developing economies, says IATA.
Air cargo capacity contracted 0.4% in March, and load factors increased by only 0.1%.