IATA cuts annual air cargo traffic growth forecast citing trade frictions, Brexit

The IATA on Tuesday nearly halved its annual forecast for traffic growth in the air cargo market to 2% citing trade frictions, Brexit and anti-globalization rhetoric. That is lower than a previous estimate of 3.7% traffic growth issued in December and leaves airlines more dependent on passenger revenue for growth. "Developments in the political climate are not going in our favor," IATA Director General Alexandre de Juniac said. Weaker global economic activity and consumer confidence led to a 1.8% fall in global air freight traffic in January, marking the worst monthly performance in three years, IATA said last week. In 2018, air cargo traffic grew by 3.5%, which was well below the extraordinary 9.7% growth during a re-stocking cycle in 2017. Asian airlines have an outsized role in air freight, accounting for nearly 40 percent of the global market because the region is a manufacturing and e-commerce hub. IATA last week said air cargo demand in Asia fell by 3.6% in January due to weaker manufacturing conditions for exporters in the region, ongoing trade tensions and a slowing of the Chinese economy.<br/>