Market Watch

By Staff -- Logistics Management, 6/1/2000

Trucking

Average prices for moving less-than-truckload (LTL) freight retreated in April, falling 0.6% from March levels. Due to previous hikes, though, LTL rates remained 5.9% higher than they were a year ago. Truckload rates, meanwhile, held steady between March and April and are up only 1.8% over year-ago levels. Even so, average prices for all types of motor freight rose 3.7% between April 1999 and April 2000. That is the fastest year-on-year escalation rate to date recorded by the Bureau of Labor Statistics' producer price index program.

Trucking

% CHANGE VS.:	1 month ago	6 mos. ago	1 yr. ago

Less-than-truckload	-0.6	+3.1	+5.9
Truckload	0.0	+1.4	+1.8
Agricultural - not local	0.0	+2.8	+3.5
General freight - local	+0.2	+1.3	+0.3
Agricultural - local	0.0	+1.7	+1.7

Water

In April 2000, average prices for the deep-sea foreign transportation of freight rose 2.0% from March levels and 26.6% from year-ago figures. Domestic deep-sea transportation rose more moderately-1.1% over March 2000 numbers and 4.4% over April 1999 levels. On the Mississippi River, prices for shipping coal jumped 8.2% and prices for refined petroleum products increased 6.9% compared with year-ago levels. Higher rail rates are affecting water rates, but strong U.S. demand for shipping services is the biggest inflation catalyst.

Water

% CHANGE VS.:	1 month ago	6 mos. ago	1 yr. ago

Inbound liner	+0.9	+3.1	+68.6
Outbound liner	+0.8	+1.0	-7.0
Domestic deep sea	+1.1	+4.4	+4.4
Grt. Lks.-St Lawrence	+0.1	+0.1	+0.1
Mississippi River	-0.2	-3.9	+10.3

Rail

Intermodal rail rates rose sharply, up 0.9% between March and April 2000, although rates for other types of rail shipments rose just 0.1% in the same period A big hike in the cost to ship stone, clay, and glass by rail contributed to the rise. Between April 1999 and April 2000, the average price for shipping those products jumped 5.5%. Shippers of primary metals are also seeing higher rail costs, with a 3.8% jump in April 2000 compared with year-ago levels. Shippers of chemicals and food products likewise will be in for sticker shock this year.

Rail

% CHANGE VS.:	1 month ago	6 mos. ago	1 yr. ago

Coal/Petroleum	+0.5	+0.5	+0.5
Chemicals	+0.2	+0.8	+1.1
Farm products	-0.7	-1.1	+0.3
Motor vehicles	0.0	0.0	0.0
Metallic ores	0.0	+4.8	+1.9

Air

The average price of heavy-freight service via scheduled airlines rose only 1.4% between April 1999 and April 2000. With freight-transportation costs on the rise in other modes, shippers should expect airfreight rates to continue climbing at least through the third quarter of 2000. After the third quarter, declines in fuel costs should help moderate inflation trends. Prices for air-courier service also are rising. In April, domestic air-courier costs rose 4.8% from March and 14.8% from year-ago levels. International air-courier prices increased 1.2% from March and 3.9% from year-ago levels.

Air