The pattern of uneven monthly truck volumes continued into April, according to data released today by the American Trucking Associations (ATA).
The ATA reported that seasonally-adjusted (SA) truck tonnage in April decreased 0.2 percent, following a 0.9 increase in March. April’s SA was 123.2 (2000=100). This was 1.1 percent short of the highest SA on record in December 2011 at 124.3. This marks the second time the SA has shown a sequential decline in the last six months. On an annual basis, the SA was up 4.3 percent, which the ATA said represents the largest annual gain since January, which saw a 4.7 percent gain. On a year-to-date basis, the SA is up 4 percent.
The ATA’s not seasonally-adjusted (NSA) index, which represents the change in tonnage actually hauled by fleets before any seasonal adjustment, was 125.9 in April, which was 0.7 percent better than March’s 125.2. And compared to April 2012, the SA was up 9.0 percent.
As LM has reported, some industry analysts maintain that the not seasonally-adjusted index is more useful, because it is comprised of what truckers haul. As defined by the ATA, the not seasonally-adjusted index is assembled by adding up all the monthly tonnage data reported by the survey respondents (ATA member carriers) for the latest two months. Then a monthly percent change is calculated and then applied to the index number for the first month.
“The slight drop in tonnage during April fit with trends from other industries that drive a significant amount of truck freight, such as manufacturing and housing,” ATA Chief Economist Bob Costello said in a statement. “After rising significantly late last year and in January of this year, truck tonnage has been bouncing around a narrow, but elevated band over the last three months.” he said. “It is also worth noting that the year-over-year comparisons are much better than expected just a few months ago and I’m hearing good comments about freight so far in May.”
Costello added that in April factory output fell 4.0 percent compared to March, with housing starts down 16.5 percent.
Both shippers and carriers have told LM that market conditions appear to be decent from a seasonal perspective while not better than average. Reasons for this include the current employment outlook, relatively low GDP growth, and cautious consumer spending. While these factors have been intact for some time now, it has led industry stakeholders to view the freight economy as slow but steady for the most part.
John Larkin, Stifel Nicolaus managing director, told LM that with the mid-year point approaching the freight market can be described as mostly mediocre.
“The consumer is beaten up and trying to de-lever rather than buy things, especially as prices rise,” he said. “Instead, they are focused on paying down debt while GDP limps along at a 1.5 percent-to-2 percent pace, which is about one-third of what we would expect in a good economy.”