Transportation Price Trends
Pricing Across the Transportation Modes
By Elizabeth Baatz -- Logistics Management, 5/1/2007
Source: Elizabeth Baatz, Thinking Cap Solutions. E-mail: ebaatz@ice-alert.com
Trucking
Wiping out the previous month’s 0.5% price cut, average prices charged by domestic truckers increased 0.5% in March. Excluding long-distance TL carriers, nearly all trucking markets contributed to the inflationary spike. Intercity LTL companies hiked tags 1.5%, but, those prices are now up only 4.3% in the 12-month period ending March 2007—a far cry from the 7.2% inflation rate seen in March 2006. Local trucking of general freight and intercity trucking of specialized freight also registered respective price hikes of 2.3% and 0.5% from February to March. Prices for TL fell 0.4% on the heels of February’s 0.7% cut. TL tags in the 12 months ending March 2007 were up a sedate 2.5%.
| % Change vs. | 1 month ago | 6 mos. ago | 1 yr. ago |
| General freight-local | 2.3 | 1.6 | 4.0 |
| Truckload | -0.4 | -0.9 | 1.4 |
| Less-than-truckload | 1.5 | 0.6 | 2.4 |
| Tanker & other specialized freight | 0.2 | 0.4 | 1.8 |
Air
Prices for moving freight on scheduled flights via domestic airlines went up 0.5% from February to March—the first time we’ve seen an increase in six months. Because prices were flying so high a year ago, however, domestic air freight tags remained 4.7% below March 2006 levels. The transformation from a marketplace that could push through big monthly price hikes in 2005 and the first half of 2006, to one that’s hard pressed to raise prices even on par with the Consumer Price Index doesn’t appear to be changing any time soon. In the 12-month period ending March 2007, airfreight prices were up only 0.8% in contrast to the 6% price hike seen in the 12 months ending March 2006.
| % Change vs. | 1 month ago | 6 mos. ago | 1 yr. ago |
| Scheduled air freight | 0.5 | -1.6 | -4.7 |
| Chartered air freight & passenger | -0.4 | 4.5 | 7.5 |
| Domestic air courier | -1.8 | 0.3 | 3.8 |
| International air courier | -1.8 | 2.5 | 6.0 |
Water
Shippers who move freight over water caught some good waves in March. All water transportation prices fell 0.5% from the previous month and were up just 0.9% from the same month a year ago. Shippers on the Great Lakes and St. Lawrence Seaway enjoyed the best budget boost as carriers on this route cut their average prices 3% from February. Meanwhile, prices for shipping on inland waterways fell 1.9%, which completed the tally for the first quarter. Compared to the same period a year ago, inland waterway prices were up only 0.3% in the first three months of 2007. What a change from the previous year when tags jumped between 13.9% in the final quarter of 2006 and a high of 24.1% in the first quarter.
| % Change vs. | 1 month ago | 6 mos. ago | 1 yr. ago |
| Deep-sea freight | 0.0 | -1.5 | -2.2 |
| Coastal & intercoastal freight | 0.5 | 8.4 | 11.7 |
| Grt. Lks.-St. Lawrence Seaway | -3.0 | 2.8 | 4.2 |
| Inland water freight | -1.9 | -10.5 | -0.5 |
Rail
Railroads reported a 0.7% cut in average prices charged in March. That more than offset the 0.4% and 0.1% price hikes that were passed along in the first two months of the year. Carload rail carriers led the charge with a 1.2% price decline in March. Intermodal rail prices, meanwhile, increased 1.8% in March after falling by that same amount in February. Weakness in the homebuilding and automobile industries is driving current declines in rail freight volumes and that has led to price cuts. A cyclical downturn in railroad prices began slowly in the second quarter of 2006 and has been steady ever since. Our revised forecast calls for rail industry prices to rise only 1.6% in 2007.
| % Change vs. | 1 month ago | 6 mos. ago | 1 yr. ago |
| Rail freight | -0.7 | -2.9 | 1.7 |
| Intermodal | 1.8 | 0.5 | 4.7 |
| Carload | -1.2 | -3.9 | 1.0 |
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Where is Baatz's June Pricing Trends?
--bill
William F. Steinke - 2007-11-6 10:38:00 EDT
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