While most of the major markets are still facing different levels of impact from the pandemic, local air traders continued positive momentum from this year’s third quarter and held a cautiously optimistic attitude towards the year-end festive season.
The overall Air Trade index recovered to the pre-pandemic level at 31.2, while indices for exports and imports increased positively. With concerns over the intensified Sino-US trade tension continuing, more than half of air traders expected a negative impact on trade this quarter amid the better trade outlook.
Despite the pandemic, nearly half of the survey’s respondents broke even or reported a positive profit in the previous quarter, of which 72% indicated a better or maintained business performance compared to Q2 2020. Meanwhile, 55% of air traders recorded a loss last quarter and 65% of them reported a decline in their operating conditions.
As the traditional festive season is approaching, air traders are optimistic about exports across the major markets and commodities, driven by demand from the Americas and Europe. Gifts, Toys and Houseware is this quarter’s strongest commodity for exports growth in almost all markets, followed by Electronic Products & Parts with more product launches of 5G devices and equipment in Q4.
Overall market indices rose to their highest level since the pandemic in this year’s second quarter, with a positive outlook on The Americas, Europe, and Asia Pacific markets, unlike the Rest of World region which indicated a drop this quarter.
Edmond Lai, Chief Digital Officer of the Hong Kong Productivity Council (HKPC), shared, “Even if the global pandemic fluctuates, companies flexibly turn to e-commerce to maintain their business operations, which will gradually improve the income of air trade. It is anticipated that the festive season in the fourth quarter may drive growth in import and export trade, so that the overall index can return to the pre-epidemic level.
“However, China-US trade friction is still one of the factors that affects the industry’s sentiment. Also, the epidemic is accelerating the changes in global trade and consumption patterns with local enterprises tackling these challenges with digital transformation.
“Amid this difficult business environment, HKPC is committed to providing timely and appropriate support to the local industrial and commercial sectors, encouraging businesses to be more agile and innovative and make effective use of available resources, to overcome adversity and develop new business opportunities.”
Commissioned by DHL Express Hong Kong and compiled by the Hong Kong Productivity Council, the DHL Hong Kong Air Trade Leading Index is the first indicator of its kind in Hong Kong and aims to provide a forward-looking perspective on overall air export and import trade volumes.
The first quarterly DTI was released in Q2 2014 by analyzing the key attributes of business demand based on a survey of more than 600 Hong Kong companies that focus on in- or out-bound air trading. An index value above 50 indicates an overall positive outlook while a reading below 50 represents an overall negative outlook for the surveyed quarter. The further the reading is from 50, the more positive or negative the outlook is.
