Skip to content

Freight Volumes Show Slow But Continued Growth

The freight market continued to grow in April at the slow pace we have experienced for most of the recovery, with North American freight volumes rising 1.9% from March to April, according to the Cass Freight Index. Spending on freight transportation grew at a faster rate and was up 3.4%.

Shipment volume has been rising steadily since January of this year, although not at a very robust pace. April’s 1.9% increase is lower than the increases in March and February, 2.1% and 2.5% respectively. Although still positive, the rate of growth declined in both March and April. April’s sequential growth is a scant 0.2% higher than April a year ago.

Cass analysts point out that Truck tonnage has been trending upward in the American Trucking Associations’ Truck Tonnage Index, but length of haul has been declining; therefore on a ton‐mile basis, truck freight has actually been flat or even contracting slightly. The boom in shale oil and gas drilling, or fracking, caused a significant portion of the rise in truck tonnage. Thousands of trucks of sand, pipe and water are being moved by truck to the wells throughout the shale plays in the U.S.

April Freight Expenditures

Overall freight spending in April was 5.1% higher than a year ago, Cass reports. The 3.4% month-to-month increase shows continued strength in rates as capacity closely matches demand, especially in the trucking sector. Much of the strength in rates comes from contract rates that were negotiated early last year anticipating a faster economic growth rate and capacity issues, which were expected to cause a spike in rates.

Comparing the increase in freight costs to the growth in freight shipments shows that payments are again rising faster than volume, Cass notes. Since operating costs for truck carriers have been steady, this translates to a better bottom line.

“This tenuous balance in the trucking sector between demand and supply will be easily undone if freight volumes pick up,” the report notes. “The 20% loss of capacity and the productivity losses due to new regulations will be felt quickly. Many in the sector have turned to an asset‐light model, and capacity will not be able to be added quickly. Indeed few carriers have indicated that they intend to expand their fleets.”

Printer Friendly Version

Email This Story

Bookmark and Share

Economy: Related News

5/9/2012 – Increases in Retail Container Traffic Expected Through Back-to-School Season

Import cargo volume at the nation’s major retail container ports will be flat in May compared with the same month last year, but is expected to see solid year-over-year increases through this summer and the back-to-school season, according to the monthly Global Port Tracker…

5/9/2012 – Freight Volumes Show Slow But Continued Growth
The freight market continued to grow in April at the slow pace we have experienced for most of the recovery, with North American freight volumes rising 1.9% from March to April, according to the Cass Freight Index….

5/9/2012 – Trucking Jobs Grow by 1,800 in April
For-hire trucking companies added 1,800 payroll jobs in April, according to the latest estimates released from the Bureau of Labor Statistics. This comes after a loss of 2,500 in jobs in March, which the BLS adjusted after initially estimating a loss of 1,900 jobs….

5/4/2012 – FTR’s Trucking Conditions Index Begins Steady Climb in March

FTR’s Trucking Conditions Index for March improved to a reading of 6.4, a half point higher than the previous month, according to the May 2012 Trucking Update.

FTR forecasts the index to continue a steady climb throughout 2012, reaching a double-digit positive reading by early 2013. …

5/4/2012 – Commercial Vehicle Orders Soft in April

Orders for Class 6 through 8 trucks dropped from March to April….

5/3/2012 – Containerized Exports Rebound in March

Driven by a surge in furniture and auto parts shipments to the U.S., containerized imports in March rose 7.3% over 2011. This increase to 1.37 million 20-foot-equivalent units came on the heels of a 5.9% decline in February….

5/2/2012 – Feb. Surface Trade with Canada and Mexico Rose 17.4% Year-Over-Year

Trade using surface transportation between the U.S. and its North American neighbors, Canada and Mexico, was 17.4% higher in February 2012 than in February 2011, totaling $78.1 billion, according to the Bureau of Transportation Statistics of the U.S. Department of Transportation….

4/27/2012 – Pricing for Used Class 8 Slips Again in March
March saw Class 8 used-truck pricing slip for the second consecutive month….

4/26/2012 – March Net Orders Signal Healthy Trailer Industry

Net orders for trailers fell 11% month-over-month in March, but for the quarter, were almost identical to orders in the first quarter of 2011, according to State of the Industry: U.S. Trailers published by ACT Research Co….

4/25/2012 – Truck Tonnage Inches up in March
Don’t expect the rate of growth this year to mirror the last couple of years, said American Trucking Associations’ Chief Economist Bob Costello, referring to the 5.8% growth in both 2010 and 2011….

4/23/2012 – Truck Makers Report Choppy Order Volume in First Quarter
Demand for Class 8 trucks “has hit a soft patch,” but at least one industry analyst expects that to be temporary.

March Class 8 new and net orders of 22,038 and 20,025 units, respectively, were the lowest order volume since last July, reports ACT Research Co….

4/19/2012 – Shippers Conditions Index Tumbles in February

FTR Associates’ Shippers Conditions Index for February dropped by a full point from the previous month to a reading of -5.6, spelling good news for tracking as demand for trucking services grew strongly in what is normally a slack month….

4/18/2012 – Spot Market Freight Availability and Rates Up in March
Freight availability and rates on the spot market increased month-over-month and declined slightly year-over-year, according to TransCore’s DAT North American Freight index. The index rose 40% from February to March but was down 6.1% compared to March 2011…

4/12/2012 – Freight Shipments up 0.5% in February

The amount of freight carried by the for-hire transportation industry rose 0.5% in February from January, rising after a one-month decline, according to the Bureau of Transportation StatisticsFreight Transportation Services Index….

4/12/2012 – Fourth-Quarter Driver Turnover Makes Surprise Drop
After a year of quarterly increases, the turnover rate for truck drivers at large truckload fleets unexpectedly dipped one percentage point to an annualized rate of 88%, according to American Trucking AssociationsChief Economist Bob Costello….

4/11/2012 – Sluggish Growth in Freight Volumes; Rates Remain Flat

Freight shipment volumes continued their sluggish pace upward in March, increasing 2.1% from February, according to the Cass Freight Index. Freight spending, meanwhile, increased 1%. This is the second month in a row that shipment growth exceeded cost growth, signifying that rates have remained relatively flat. …

4/11/2012 – Retail Container Traffic Predicted to Increase 3.2% in April

Import cargo volume at the nation’s major retail container ports is expected to increase 3.2% in April compared with the same month last year. Year-over-year gains should continue through the end of summer, according to the monthly Global Port Tracker

4/9/2012 – 2011 Driver Numbers, Wages Increase; March 2012 Sees Drop in Drivers
The number of heavy-duty truck drivers in 2011 rose 2.8% to 1.51 million from 1.46 million in 2010. It’s the first yearly increase in the number of heavy truck drivers since 2008, when the number was 1.67 million, according to the Bureau of Labor Statistics. …

Emil Estafanous, CPA, CFF, CGMA