Aside from the heightened price and exchange rate volatility that forwarders were challenged with in 2015, a point which could get overlooked is that they also faced what appeared to be weaker underlying volume growth in the year.
As part of the research for Ti’s upcoming report – Global Freight Forwarding 2016 – the ‘top-level’ data indicates that both air and ocean volume growth were lower year-over-year.
For example, IATA and ACI data suggests that both growth of international air freight tonnes and tonne kilometres were down in 2015, as indicated by the declining orange and blue lines in the chart below. More specifically, IATA has stated that global freight tonne kilometre growth in 2015 was just 2.2%, down from 4.5% a year ago.
Global Air Freight Traffic Growth, % change year-on-year
Source: IATA, ACI
A look at the sea freight market is similarly downcast. Volume growth as measured by global export TEUs weakened in the second half of 2014 and remained muted throughout 2015, with the final quarter offering the best growth.
Global Export TEU Volume Growth, % change year-on-year
Source: Container Trade Statistics
An inspection of the data at an annual frequency shows the decline in the year more clearly. Global export TEU growth in 2015 was just 2.0% compared to 3.9% in 2014.
Finally, the IMF’s global export volume growth data* also suggests a weaker underlying market, although it is worth noting that this figure includes trade by all modes of transport and of all commodities.
Global Export Growth, % change year-on-year
Source: Container Trade Statistics, IMF
To finish, it is worth acknowledging that thankfully the IMF do anticipate better times ahead. From 2016 to 2021, global export volume growth is forecast to average 3.7%. While improved fortunes can be hoped for on this basis, forwarders should continue to transform themselves into entities which offer value-adding, non-commoditised services to bolster their margins.
*The IMF’s global export volume growth data measures growth in the total value of global trade in 2015 compared to 2014 with prices held constant year-on-year.
To register your interest for Global Freight Forwarding 2016 report please contact Michael Clover directly: [email protected]
Source: Transport Intelligence, 31st May 2016
Author: David Buckby
