St. Louis, MO – The North American freight market has continued its positive trend, albeit less strong in July 2017 with a 1.4 percent year-over-year increase, according to the latest Cass Freight Index Report.
The index shows data points that suggest the U.S. economy is strengthening, but some show deceleration, particularly in rail. Consumers are spending money, but not in brick-and-mortar stores.
Donald Broughton, an economist with Avondale Partners and author of the report, says data suggests that the overall freight recession, which began in March 2015, appears to be over and, “more importantly, freight seems to be gaining momentum in most segments.”
The Cass Freight Expenditures Index posted a 4.5 percent increase year-over-year in July, as pricing continues to improve with truckers and intermodal shippers. As a result, the Cass Truckload Linehaul Index has increased in recent months, with June seeing an increase of 1.8 percent.
Parcel volumes associated with e-commerce continue to show large rates of growth, with both FedEx and UPS reporting strong U.S. domestic volumes, said Broughton. According to the most recent Broughton Capital index (May), airfreight has also been showing improving strength, with the Asia Pacific lane jumping 12.3 percent and the Europe Atlantic lane growing 4.3 percent on a year-over-year basis. Improvements in the Asia Pacific lane have helped the tech sector while the Europe Atlantic lane has aided in modest growth in the European Union economy, said Broughton.
Trucking tonnage appears to growing, said the index, albeit in a volatile and inconsistent way. “Recent trucking industry data released by the ATA is discouraging,” said Broughton, “but recent indications from DAT Solutions (a source we believe is far more reliable) is indicating a much stronger outlook for trucking.”
Of all the sectors, rail is the weakest. According to Broughton, weakened rail volumes are affected the strength of the U.S. dollar, despite the higher price of oil during the first half of 2017.
The Cass Freight Index is based on domestic freight shipments of hundreds of the company’s clients across a wide variety of industries. Cass Information Systems processes more than $26 billion in annual freight payables.