Freight volumes are expected to keep increasing this year with trucking capacity to continue tightening – a recipe that should result in freight rate hikes for the industry by as much as 5 to 8 per cent before 2014 is over, says a report commissioned by the US Council of Supply Chain Management Professionals and sponsored by Penske Logistics. This report was unveiled at the National Press Club in Washington, DC, June 17 at the 25th annual State of Logistics, said Fleet Owner magazine.
Overall, truck tonnage increased 6.1 per cent in 2013, which is much higher than revenue figures would seem to indicate.
For its part, the Shippers Conditions Index pulled back a point to negative of 7.7 points for April. This one month change does not signal any real improvement in trucking capacity, analysts agreed.
Wood Products
“The index remains in low territory reflecting the 98-99 per cent readings for truck capacity utilization, with little relief in sight until the next recession,” Eric Starks, President of FTR Transportation Intelligence, said. “Freight growth should remain strong through the balance of the year and the rate shippers pay for truck freight will continue to rise.”
Transportation of North American dimension lumber products this May was generally stable over 2013, the latest data from Canada and the US demonstrates.
Canadian railway carloadings of lumber increased by 10 per cent in the first four months of 2014, from 37,969 cars in 2013 to 42,154 cars this year, according to Statistics Canada June 26.
Meanwhile, the Association of American Railroads (AAR) Thursday reported increased US rail traffic for the week ending July 5, 2014, of 270,731 total carloads, which is up 9.4 per cent compared with the same week last year. Total US weekly intermodal volume was 227,097 units, up 10.5 per cent compared with the same week last year. Total combined US weekly rail traffic was 497,828 carloads, and intermodal units were up 9.9 per cent compared with the same week last year.
Carloads of forest products on the rails in America that week were 10,789 units, up 5.5 per cent from the same week last year, while year-to-date carloads of forest products were 301,167 units, a 2.4 per cent increase.
Canadian railroads reported 77,193 carloads for the week, up 12.4 per cent, and 57,349 intermodal units, up 12.9 per cent compared with the same week in 2013, said AAR. For the first 27 weeks of 2014, Canadian railroads reported cumulative volume of 2,111,569 carloads, up 0.3 per cent from the same point last year, and 1,504,099 intermodal units, up 6.3 per cent from 2013.
For overall North American (Canada, US, Mexico) forest products rail traffic for the week ended July 5, 2014, carloads were 17,908 units, up 3.3 per cent compared to 2013 said AAR.
Cumulative year-to-date North American forest products carloads were 498,698 units, a 0.9 per cent decrease over the same time last year.
In America the freight logistics sector continued to strengthen in June, with both shipment volumes and expenditures rising once again according to the latest Cass Freight Index, said Trucking Info Tuesday. The freight expenditures index rose 4.2 per cent in June to 2.76, a record high. June 2014 freight spending was 12.1 per cent higher than a year ago and is up 15.6 per cent since the beginning of 2014.
June shipment volumes increased 2.4 per cent to the highest level since November 2007. Volumes were 6 per cent higher than a year ago and are up 15.8 per cent since the beginning of 2014.
“Construction and manufacturing activities, both drivers of demand for transportation services, have been rising for several months,” said Rosalyn Wilson, supply chain expert, who provides analysis for the report.
She noted the Institute for Supply Management’s Purchasing Managers Index slipped just slightly from 55.4 to 55.3 during June, but there was strong growth in the manufacturing of autos and construction equipment. New orders rose 3.5 per cent, indicating that demand for transportation should remain strong for the next several months.
On the roads, TransCore Link Logistics’ Canadian freight volumes rose 2 per cent in May, marking a 31 per cent improvement year-over-year, said Truck News June 17. The TransCore Canadian Freight Index measures volumes from about 5,000 Canadian trucking companies.
In May, cross-border postings accounted for 69 per cent of total load volumes. Cross-border loads originating in Canada rose 70 per cent year-over-year while loads originating in the US were up 10 per cent over last May.
TransCore reported intra-Canada load volumes comprised 25 per cent of total May volumes, and were up 34 per cent compared to last May.
The index showed continued tight capacity, with truck levels remaining low relative to the same period last year. Equipment postings were up 4 per cent month-over-month, but were down 10 per cent compared to last May.