May freight shipments and expenditures saw annual declines and sequential gains, according to the new edition of the Cass Freight Index, which was recently issued by Cass Information Systems.
Many freight transportation and logistics executives and analysts consider the Cass Freight Index to be the most accurate barometer of freight volumes and market conditions, with many analysts noting that the Cass Freight Index sometimes leads the American Trucking Associations (ATA) tonnage index at turning points, which lends to the value of the Cass Freight Index.
What’s more, the Cass Transportation Index accurately measure changes in North American freight activity and costs based on $37 billion in paid freight expenses for the Cass customer base of hundreds of large shippers.
The May shipments reading, at 1.041, fell 1.2% annually, faring better than April’s 4.4% annual decline, and rose 3.0% sequentially (its fourth straight sequential increase), and fell 0.3% on a month-to-month seasonally-adjusted (SA) basis. On a two-year stacked-change basis, May shipments were off 5.2%.
Tim Denoyer, the report’s author and ACT Research vice president and senior analyst, observed in the report that May’s 3% sequential volume gain, coupled with the annual decline falling to 1.2%, with the report stating that the latter is the smallest gap in 18 months, serve as positive signs that a volume recovery in the second half of the year remains likely. What’s more, he added that the normal seasonal trend would put the shipments reading decreasing around 1% in July.
“While it may not be a consumer-led recovery, inventories are tight, tariffs are falling, and the U.S. dollar is soft, all of which support demand growth,” he wrote. “Many spot indicators suggest improving freight demand and certain sectors are executing well on growth, such as the domestic intermodal market.”
May expenditures, at 3.560, increased 7.5% annually, following a 3.5% annual gain in April, and headed up 8.3% on a two-year stacked-change basis, while posting a 5.3% sequential gain. On a month-to-month SA basis, April expenditures rose 4.9%.
Denoyer noted that the acceleration in the annual gain was due to slower shipment declines, while rates rose slightly.
