Subscribe to our free, weekly email newsletter!


October Cass Freight Index is down from September, up annually

By Jeff Berman, Group News Editor
November 04, 2011

The October 2011 edition of the Cass Freight Index showed signs of mixed messages, when it comes to figuring out freight trends. While freight shipments and expenditures were up annually, they were both down from September in another sign that the economic recovery is both gradual and unpredictable.

This index accurately measures trends in North American shipping activity based on $17 billion in paid freight expenses of more than a hundred of America’s largest shippers, according to Cass officials.

Cass data indicated that October shipments at 1.081 were down 10 percent compared to September and up 2.2 percent annually. Shipments were north of the 1.0 mark for the 17th straight month since May 2010, when shipments moved above the 1.0 mark for the first time since November 2008.

Expenditures at 2.295 were down 4 percent compared to September and up 16.1 percent compared to last year, which is roughly half of what annual expenditures comparisons have been in previous months prior to August, which was up 15.8 percent annually, with January through July averaging 30.9 percent annual increases for expenditures.

As LM has reported, many trucking industry executives and analysts consider the Cass Freight Index as the most accurate barometer of freight volumes and market conditions, with many analysts noting that the Cass Freight Index sometimes leads the American Trucking Associations (ATA) tonnage index at turning points, which lends to the value of the Cass Freight Index.

In an analysis of the October data, Cass Director of Products & Services Frank Cirimele wrote that while shipment volumes from September to October are not unusual, this year’s “rate of decline was steeper than expected,” when compared to the 2010 and 2009 declines for the same timeframe at -5.2 percent and -4.7 percent, respectively. He added that a downturn in shipment activity was anticipated in October, which was driven at least partially by softening in order volumes both domestically and abroad.

Looking at expenditures, Cirimele observed that this current batch of numbers shows that efforts by carriers to raise rates and recover increases in operating costs appear to be sticking, with shipment weights across all modes up about 1 percent annually, resulting in a dramatic increase in the transportation of an average shipment.

With this report’s data neither overwhelmingly positive or negative, shippers and carrier have told LM things remain stable for the most part, given the current headwinds of increasing fuel costs, regulatory red tape for multiple modes, and a difficult time finding available drivers for motor carriers, which has in turn created some problems for shippers in securing capacity.

Robert W. Baird & Co. Analyst Jon Langenfeld wrote in a research note that on the truckload side, demand trends moderated in October from September, adding that the demand environment looks stable, with less-than-truckload growth staying firm and supported by recent industry rate increases. Both sentiments are consistent with the Cass data.

And a shipper who uses all modes told LM that his company is seeing a stable environment in terms of service from transportation carriers to a large degree.

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).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Information abounds about the growing trend of electric lift trucks and the advantages and disadvantages of the electric solution. Amid all of the information from so many sources, what's the truth about electric lift trucks? This complimentary white paper breaks through the clutter to review why electric lift trucks are gaining in popularity and also to review their challenges, as well as their economic and environmental benefits.

Three weeks after initiating a coordinated series of slowdowns that have mired the major West Coast ports of Tacoma, Seattle, Oakland, Los Angeles and Long Beach, the ILWU has pushed away from the bargaining table.

DHL has released the third edition of its Global Connectedness Index (GCI), a detailed analysis of the state of globalization around the world.

The truck driver shortage is worsening, threatening the trucking industry’s ability to serve the nation’s supply chains. The shortage will almost certainly cause fleets’ costs to increase and shippers’ rate to continue to rise.

The Agriculture Transportation Coalition has asked the Administration to bring in a federal mediator to help resolve the negotiations, and if a strike or lockout occurs, the AgTC advocates the rarely-invoked Taft-Hartley Act.

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA