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Posts tagged as “United States”

US Air Cargo Market Outlook in 2025

The US domestic air cargo market today is about as big as it was in early 2017 – despite a boom in e-commerce. After growing at about 3.7% per year between 2012 and 2021, flown traffic has dropped by almost 20% since early 2022. The bad news is that we may see more declines in the next 18 months. The good news is that declines are likely to be more moderate. This article looks at the outlook for the US air cargo market and discusses what it means for the demand for air capacity. 

Rapid Growth in Chinese Low Value Exports

Low value trade accounts for about 2.5% of Chinese export trade value. Much of this is cross border e-commerce traffic and has grown by 37% in 2023 and 32% so far this year. This has been good for long haul airfreight, may not be sustainable in the long run unless platforms continue to subsidize shipping costs. This article provides an assessment based on Chinese customs statistics which contrary to US or European statistics provide information on low value trade.

Express, Air and Ocean Freight Revival Moving at Different Speeds

International air express, air freight and containerised ocean freight do not always move in sync – even though growth in all three is correlated to changes in economic activity. Part of this is due to how quickly each responds to changes in the inventory cycle or relative price differences, but also the underlying industry segments and customer profile that driven each segment. Consumer demand has performed better (or less worse) than manufacturing activity and as such containerised shipping and express have performed better than general airfreight. Air cargo traffic – which consists of a mix of express, cross border e-commerce and general air freight – has been strong, primarily because of e-commerce.

Trade to Grow when Manufacturing Picks Up

Global trade growth expectations have been successively downgraded over the past twelve months and year end 2023 numbers are likely to come out at about around 1%, according to December estimates prepared by the OECD. Long haul trade may even be solidly negative based on what we have been seeing for key trade generators such as China, the European Union, and the United States. Trade growth can only pick up if manufacturing activity does the same. The bulk of world trade consists in the movement of industrial inputs, intermediate and capital goods. As such global trade and industrial production are directly linked. Manufacturing has been weak all throughout 2023, but an improvement could take place in the second and third quarter of 2024.

Trade Outlook Downgrade in Latest Forecast

This week the IMF published its 6 monthly world economic outlook and associated databases. Compared to the April 2023 version, the outlook for trade in 2023 has deteriorated. The current expectation for 2023 goods imports is a decline of 0.5% rather than growth of 1.6%. At a country level, the picture is mixed – with some countries showing an upgrade and others a downgrade of their previous outlook. This article focuses both on the overall outlook as well as where changes have occurred.

China Drives Global Electric Car Sales and Trade

China has a market share of about 20% of the world electric car market outside China as well as being the world's largest electric car market. Growth in Chinese car exports has been exponential with exports of electric cars growing 123% so far this year. However, electric export growth has also been picking up in traditionally combustion focused countries such as Japan.

Recent Developments in Semiconductor and Machinery Trade

Trade in integrated circuits is worth almost $1 trillion annually. This includes processers, controllers, memory chips and the like, which form the centrepiece of most things we use or drive. Machinery and related parts, accessories and tools for producing semiconductors are worth another $100 billion per year. The value of semiconductor and machinery trade is higher than it was in 2018, but trade patterns are changing significantly with new production capacity being established around the world and not just in China and the United States.

Global Vaccine Trade Has Increased Substantially but Will It Last?

COVID-19 vaccine production has led to significant additional temporary global vaccine traffic. However, with countries such as Brazil, China or India growing their manufacturing base this could create new regular cross border flows. This article looks at global vaccine production and cross border vaccine flows in and out of China, India, the United States and the European Union, as well as emerging flows out of countries such as Brazil and Russia.

Manufacturing Outlook Points to Declining US Air Cargo in 2023

Airfreight is primarily an industrial tool, with roughly three quarters of airfreight traffic linked to the various stages of production. Global manufacturing and airfreight tend to move in sync. Based on the outlook for manufacturing we expect US airfreight exports to decline by about 7% and imports to drop by about 3% in 2023.

Transatlantic Air and Ocean Trade Outlook

Transatlantic air cargo was a real bright spot in 2022, both in terms of volumes and market rates. Containerised shipping did not do as well in volume terms, but rates have remained strong even as they have tumbled back down to earth in other markets. This analysis discusses the interplay between demand, capacity, and the relative competitive position between air and sea freight and how this is likely to evolve over the next year.

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