Freight expenditures fell in August by 1.5 percent compared to the previous month, representing the first decline after three months of gains, according to the Cass Freight Index Report
Year-over-year, expenditures rose 3.4 percent. In August, the number of shipments grew 1.7 percent over July’s total, but fell 0.4 percent when compared to August 2012.
The fall in freight expenditures, so far, has had nothing to do with the new federal "Hours of Service" rule, according to Cass.
“In fact, there is still enough capacity available in the entire freight market that competition continues to hold rates steady,” it said. “The August decline is due more to the mix of commodities shipped in August than to lower rates.”
The higher shipment volumes this month, Cass said, mirrors an expectation that the industry will see a peak holiday season this year. Last month’s shipping growth was fueled primarily by a railroad spike, showing a 6.5 percent rise in intermodal shipments and a 6 percent increase in carloads.
“The trucking industry is still in a precarious balance, with over 95 percent capacity utilization and an abundance of regulatory and cost pressures that indicate a looming capacity problem,” Cass noted. “The tricky part is forecasting when demand will actually exceed capacity. The economy is growing slowly enough that the tipping point remains just on the horizon.” - Jon Ross