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Department of Commerce reports durable goods orders are down 2.1 percent in June

By Jeff Berman, Group News Editor
July 27, 2011

At a time when economic momentum continues to fluctuate, new orders for durable goods showed in June did nothing to quell that notion, falling 2.1 percent—or $4.0 billion.

New orders have been down two of the last three months, said Commerce, with May’s 1.9 percent increase sandwiched in the middle.

June shipments of manufactured goods, which have been up in six of the last seven months, were up 0.5 percent—or $1.0 billion—to $196.0 billion. May shipments saw a 0.5 percent increase.

While economic growth is relatively shaky, the up and down nature of durable goods and new orders is fairly consistent with what is occurring in the freight transportation sector, which is seeing mostly flat growth compared to a year ago and now appears to be following more traditional seasonal patterns.

This was made clear in a recent research report by Jon Langenfeld, transportation analyst at Robert W. Baird.

“Following June’s seasonal strengthening, industry contacts and data points indicate July volumes have slowed, consistent with typical seasonal patterns,” wrote Langenfeld. “Commentary through 2Q earnings reporting has indicated expectation for a muted, compressed peak season but one that resembles a more ‘normal’ pickup beginning mid-3Q. Contacts indicate volume has seasonally slowed in July, trending in line with historical expectations.”

And as LM has previously reported, a good amount of growth stems from a very strong manufacturing sector, which has shown expansion for 25 straight months, according to the Institute for Supply Management.

“We are seeing steady growth for the most part,” a metals shipper said in a recent interview. “It is not great compared to what we have seen in the past, but it is clear that demand for goods is intact.”

About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).

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