ATA’s seasonally-adjusted tonnage is up in October

As the economy continues its slow-paced recovery, the American Trucking Associations (ATA) added a dose of optimism to the overall outlook, reporting that truck tonnage in October was up for the second straight month.

The ATA’s advance seasonally-adjusted (SA) For-Hire Truck Tonnage index was up 0.8 percent in October, coming on the heels of a revised 1.8 percent September gain. The current SA index is at 109.7 (2000=100). On an annual basis, the ATA said the SA is up 6.0 percent compared to October 2009, which is slightly better than September’s 5.3 percent annual increase.

The SA has been up year-over-year for 11 straight months, even though the relatively easy comparisons to 2009 are not as significant.

The ATA also reported that its not seasonally-adjusted index (NSA), which represents the change in tonnage actually hauled by fleets before any seasonal adjustment, hit 112.9 in October for a 0.3 percent gain from September. Compared to October 2009’s 109.6 NSA, the October 2010 NSA is up 3.3 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.

During the first half of 2010, inventory re-stocking resulted in encouraging signs regarding trucking volume trends, especially when compared to 2009. But beginning around mid-year, the inventory re-build ostensibly stalled out and led to declining truck tonnage volumes in August. 

And while unemployment remains high, coupled with consumer confidence far from peak levels, recent signs indicate that truck tonnage growth may be on the right path. Some of these signs include: today’s announcement from the Department of Commerce that the GDP grew at an annual rate of 2.5 percent in a new estimate, following a GDP growth rate of 1.7 percent in the second quarter; last week’s Commerce report that retail sales were up 1.2 percent in August, and continued mostly steady gains in the Institute of Supply Management’s monthly Manufacturing Report on Business and the Cass Information Systems monthly Freight Index.

“October tonnage levels were at the highest level in three months, even after accounting for typical seasonal shipping patterns,” said ATA Chief Economist Bob Costello in a statement. “These gains fit with reports out of both the manufacturing and retail sectors and show there is a little bit of life in this economic recovery.”

This type of sentiment was also apparent at last week’s TransComp expo in Ft. Lauderdale, Florida, with carriers and freight brokers telling LM they are seeing increased signs of demand in recent weeks.

“It may be a seasonal effect, but it is clear things are picking up on a sequential basis lately, but there is still a long way to go to really get back to where things were before the downturn,” a truckload carrier told LM at the event.

Another factor likely to impact future growth may be an anticipated decline in capacity brought about by the soon to be rolled out CSA 2010 and pending Hours-of-Service regulations.

A carrier recently communicated to LM that on an anecdotal basis it is clear that shippers are clearly interested in securing capacity and are taking steps to ensure they have the resources they need from their key carriers as they approach higher-volume seasonal shipping months.

Trucking serves as a barometer of the U.S. economy, because it represents 68 percent of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods, according to the ATA. The ATA notes that it hauled 8.8 billion tons of freight in 2009, and that motor carriers collected $544.4 billion-or 81.9 percent-of total revenue earned by all transport modes.