KUALA LUMPUR (Sept 13): Annual growth in air freight tonne kilometres (FTKs) slowed to 2.8% in the three months ended July – its slowest pace on this basis in more than two years, according to the International Air Transport Association (IATA).

In its Q3 2018 cargo chartbook released yesterday, IATA said while FTKs are continuing to increase in seasonally adjusted (SA) terms, the upward trend has slowed markedly from that seen during the best of the upturn in air freight last year.

It said this largely reflects the fact that the inventory restocking cycle, which helped air freight growth to outperform that of wider global trade in 2016/17, has now run its course.

More generally, against a backdrop of rising trade protectionism measures, wider momentum in world trade also looks to be weakening, it said.

IATA said cargo yields have continued to trend upwards in H2 2018, albeit at a slower pace than a year ago.

It said while the industry-wide load factor is trending down, ongoing high rates of freighter aircraft utilisation will continue to help to reduce average costs, and to help offset ongoing upward pressure on costs, particularly from higher fuel prices.

IATA added that annual FTK growth has slowed on all the major international markets over the past year, and recently fell into negative territory on the Europe-Asia market for the first time since mid-2016.