Cass: January freight volume, spend seasonally flat
Freight expenditures have leveled off in recent months as the reduced shipment volume took pressure off capacity and rates stabilized.
The Trucker News Services
2/8/2012
North American freight volumes continued a seasonally normal, four-month decline, decreasing just less than one percent in January, according to the latest Cass Freight Index report.
Year over year, January’s shipment volume was 3.6 percent higher than in 2011.
Total freight expenditures were essentially unchanged from December, while year over year they were up 22.1 percent.
“The year-over-year comparison is, however, misleading because January 2011 was the lowest point the Index reached in the last 18 months,” the report noted. “Last year, bad weather impacted January freight movements; this year, the story is the slump in the economy. The 2011 GDP growth rate was 1.7 percent, well below the 3 percent growth in 2010.”
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Freight expenditures have leveled off in recent months as the reduced shipment volume took pressure off capacity and rates stabilized. Total freight spend has been relatively flat over the last several months, mirroring shipment volume, indicating that the rate increases that were prevalent for most of 2011 have slowed too, according to the report.
“Although many economic indicators showed strength in the fourth quarter, this strength has not yet translated into a growth in freight shipments,” the report said.
— GDP grew 2.8 percent, compared to 1.8 percent the previous quarter.
— Consumer confidence is still inching up, reaching its highest level in almost a year.
— The unemployment rate dropped to 8.3 percent, its lowest point since February of 2009.
— Manufacturing is gaining strength again, with new orders, production and employment rising in January, according to the latest Institute for Supply Management Report.
— The National Retail Federation is predicting a 3.4 percent rise in sales in 2012 and GDP is expected to rise about 2.3 percent.
“These developments should drive an increase in freight shipments by March,” the Cass Information Systems report concluded.
The Cass Freight Index represents monthly levels of shipment activity, in terms of volume of shipments and expenditures for freight shipments. Cass Information Systems processes more than $20 billion in annual freight payables on behalf of its clients. The Cass Freight Index is based upon the shipments of hundreds of Cass clients representing a broad spectrum of industries. The index uses January 1990 as its base month.
Kevin Jones of The Trucker staff can be reached for comment at kevinj@thetrucker.com.
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