European freight forwarder confidence continues to be weak, according to the latest Stifel Nicolaus Logistics Confidence Index (LCI).
October marked the sixth consecutive month of sequential decline in the index, which the investment bank produces with the U.K. research firm Transport Intelligence.
The monthly survey of international shippers and forwarders measures freight activity across several European-based trade lanes, to serve as a barometer for the health and trajectory of international freight movements.
The October reading came in at 47.3, Stifel Nicolaus said, 0.6 percent below September's figure, “but still indicative of decline, and still underperforming versus normal expectations for this time of year.”
The bank said survey respondents indicated that current international trade volumes remain poor relative to normal seasonal expectations, as suggested by an indexed reading of 40.4 vs. the benchmark of 50, and as compared with last month's 40.6.
“The deceleration was less than in previous months, but, perhaps more importantly, the six-month outlook for air and ocean freight volumes continued to worsen,” the bank said. “On a positive note, current sentiment in air freight saw sequential improvement for the first time since March 2012. The improvement was reflected in each of the four European trade lanes monitored by our survey. However, it is unclear yet if this uptick will be the first of several or just a bounce off the bottom. Persistent deterioration in the expected air freight environment may suggest the latter to be true. In either case, one should note that total current air freight sentiment remains well below benchmark.”
Ocean freight continues to be plagued by weak demand.
“Volumes fell in most trade lanes, as they pertain to the expected climate, with the only improvement seen on the Europe-Asia route,” Stifel Nicolaus said. “However, the index for the six-month outlook remains above 50.0, suggesting that forwarders still have some confidence (if slightly less so than in previous months) that things will get better.” - Eric Johnson