Last year will go down as a great one for air cargo, with traffic increases outstripping capacity growth, and as we closed the year, IATA estimated that demand, measured in freight tonne kilometres (FTKs) grew by over 9% in 2017 compared with 2016, writes Glyn Hughes, head of cargo at IATA.
The higher growth in 2017 was explained by some revival in world trade and the cyclical upturn in the global economy.
Crucially, air cargo growth was stronger than that of world trade, and as we move through 2018, we expect a continuation of favourable global macroeconomic conditions.
However, despite this, we forecast air cargo growth rates to moderate in 2018. IATA also expects further strengthening in emerging trends that have a positive effect on air cargo demand, such as hi-tech product launches, increased demand for high-value pharmaceutical and temperature-sensitive commodities.
We also see increased cross-border e-commerce shipments, which bring with them heightened expectations of quicker delivery times and expanding just-in-time production models, all of which create stronger demand for air cargo.
The positive prospects are very well-received by the industry, but with extra demand comes additional challenges and we anticipate a number of them to grow in significance as we strive forward as an industry.
Some began to surface during 2017 and these will need to be tackled in order to fully capitalise on the growth opportunities and new market conditions.
Congested airports; slot restrictions; capacity constraints; complex regulations; ever more demanding customer expectations; facility congestion; increasing needs for digitalised data; rapid technology enhancements; and the need to attract, retain and develop quality people are just a few.