2015 weakness from low vols not adverse yield dev’ts: WorldACD

For the second month in a row, the worldwide average USD-yield improved month-over-month (MoM), this time by 1.0 per cent, down however, from last year’s MoM figure of +1.7 per cent.

WorldACD yield

2015 in perspective
“A lot is being made of the stark worldwide yield decreases we have witnessed. However, as stated before, the yield developments of the past 12 months are truly one-of-a-kind: They simply cannot be equated with an extremely serious downward trend in air cargo, as some industry observers seem to want us to believe,” said WorldACD pointing to the vast amount of data at its disposal.

To start the company compared the first three quarters of 2015 with the same period in 2014. The main lesson, it said was that at this point in time, getting a better understanding of the fortunes of air cargo will not be helped much by making YoY comparisons of yields-including-charges. This is due to two developments it said: First a stark drop in fuel prices dating back to a little over a year ago, and secondly an increase in the use of all-in pricing.

Fuel prices worldwide have come down to less than 50 per cent of what they were mid last year. The worldwide USD-yield-including-charges decreased by 14 per cent in 2015 compared with 2014, almost exclusively as a direct consequence of lower fuel charges. Thus, the worldwide average price per kg (in USD & net of surcharge effects) stayed at the same level: In some instances it dropped a bit, in others it slightly rose. “Coupled with the fact that average prices per kg for all-in shipments remained stable as well, we draw the conclusion that – in terms of market development – the weakness in 2015 has been insufficient volume rather than adverse yield developments.”