Sunday, April 22, 2018

Linehaul Index down eight straight months, Intermodal Price Index up first time since December 2014

Monday, November 28, 2016

ST.LOUIS — Cass Information Systems Inc. reported November 23 that their October Truckload Linehaul Index decreased 1.4 percent from the same period last year to just under 126, making eight consecutive declines. Driver pay increases, fleet growth, reduction in carrier bankruptcies and “an easing of the 34-hour restart rule” contributed to the continued declines, analysts at Avondale Partners said.

The Cass Intermodal Price Index rose 0.4 percent from last October to 131, the first annual increase since December 2014, according to analyst Donald Broughton.

"We concede that one month does not make a trend and that this data set is influenced by [relatively flat fuel costs] but we will continue to monitor the data in the coming weeks," Broughton said. "We expect intermodal rates will continue to remain subdued in 2016 as the drop in diesel prices and even more dramatic drop in oil continues to take its toll on U.S. domestic demand.

“Although it is far too early to make a ‘change in trend’ call, data is beginning to suggest that the consumer is finally starting to spend a little and that the industrial economy’s rate of deceleration has eased. Simply put, the winter of the overall freight recession we have seen for over a year and a half in the U.S. may not be over, but it is showing signs of thawing.”

The shipments index of 1.121 represented a 2.7 percent gain from last year and a 0.9 percent increase from September. The expenditures index of 2.343 decreased 3.8 percent from October 2015 and 2.2 percent from September 2016.These numbers are better than in recent months, Avondale stated, while pointing to improvements in pricing power of truckers and intermodal shippers.

However, the trucking industry continued to produce poor results.

“Tonnage itself appears to be growing,” analyst Donald Broughton wrote. “Counter to this, truck loads have now contracted on a [year-over-year] basis five out of the last seven months. No matter how it is measured, the data coming out of the trucking industry has been both volatile and uninspiring.”

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