The number of domestic freight shipments fell by 1.5 percent, year over year, last month, but the money spent on freight increased by 0.8 percent, according to the Cass Freight Index Report
Compared to May, shippers saw a miniscule, 0.09 percent bump in activity and a 3.4 percent rise in expenditures.
The June shipment volume is the lowest Cass has recorded during the same month in the past three years. For the year as a whole, shipment volume is up 5.8 percent, but that is mainly due to relatively strong first-quarter growth. March served as the growth high-point, and activity has been slowing down since then.
On the railroad side in June, carloadings fell 0.7 percent and intermodal declined 1.1 percent. Trucking, however, is trending upward.
More money was spent to ship in June due to heavier loads and different commodity mixes, and not necessarily an increase in rates. In fact, rates are decreasing, most carriers report, but they could start to climb as the impacts of the new hours-of-service regulations are felt.
"If trucking capacity gets scarce, and it will, then the initial beneficiary will be intermodal loadings,” according to the report. “As trucking rates rise, rates for other competitive modes – especially intermodal – will also increase.”
Officials at Cass say the overall numbers are a continuation of the roller-coaster trend seen in the freight world during the past two and a half years. There is a bit of hope around the corner, though. The economy has been on a bit of an upswing, and that should help boost activity in the next few months, officials said.
“Economic drivers such as construction spending, factory orders (especially for durable goods), and consumer confidence all gained strength in May and June,” the Cass report noted. - Jon Ross