An uptick for air cargo, while ocean remains flat

In what amounts to something of a reversal of fortune, shipper confidence in the air cargo sector appears to be gaining on that of ocean freight.

According to the latest edition of the Stifel Logistics Confidence Index, the total air freight logistics confidence Index gained 0.5 points in March 2016, totalling 48.6.

The Index is 9.3 points lower than in March 2015, and 7.3 points lower than in March 2014. Regarding the present situation, the air freight Index rose by 0.9 points to 45.4.

Continuing on from January, all lanes posted month on month growth with the exception of Asia to Europe, which lost 2.5 points to reach 41.4. Europe to Asia gained 1.3 points, though remained below the 50 point mark, standing at 39.1. US to Europe gained 2.6 points to 49.0, while Europe to US also gained 2.6 points, and at 53.0 represented the only lane in positive territory.

In the expected outlook, the total results were flat, as half the lanes saw gains, while the other half saw declines. Europe to US recorded the most significant gain, increasing by 2.6 points to 52.2. By contrast, US to Europe fell 1.6 points to 53.3. Meanwhile, Europe to Asia fell by 1.6 points to 49.7, whilst Asia to Europe increased by 0.6 points to 51.8.

Meanwhile, the logistics confidence Index for sea freight declined by 1.0 points to 45.3. Additionally, when compared with the same month in 2015, the Index is 11.4 points lower, and it is also 12.7 points lower than in March 2014.

For the present situation, the Index gained 0.8 points to 41.5. Half of the lanes noted gains, whilst half saw declines. The former group was made up of Europe to US and US to Europe, which noted gains of 3.9 points to 49.3 and 0.9 points to 37.9, respectively.

The expected situation Index for sea freight saw a 2.8 point decline to 49.1, with contractions in all lanes apart from Europe to US, which gained 0.8 points to 56.0. Meanwhile, US to Europe lost 4.6 points, falling to 46.2. Europe to Asia lost 3.0 points, and Asia to Europe declined 4.3 points, with each amounting to 44.1 and 50.5, respectively.

Each month, respondents to the Stifel Logistics Confidence Index survey are asked a unique, “one-off question.” The March one-off question referenced both the seasonal dip in air and sea freight volumes derived from Chinese New Year, and the current slowdown of China’s economy. The question asked respondents what they expected to see happen to volumes during this February’s Chinese New Year.

In response, 55% of survey participants, a clear majority, replied that they expected a more pronounced dip than usual, while 17% responded to the contrary. The remaining 28% of respondents indicated an expectation that the volume dip would be consistent with historic trends.