Supply Chain Digest Says...
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| Denoyer for many months has cited aggressive moves by private fleets to leverage their unused capacity to act as carriers for others has been a market drag on the for-hire market. |
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It’s been tough times in the US freight sector for more than two years, but there were some signs of growth in February, according to the Cass Freight Report for the month released late last week,
The Cass report for January was released late last week and it showed shipment volumes in the US were up 10.5% versus January, though about half of that rise, Cass said, was the result of normal seasonality. In seasonally adjusted terms, the index rose 4.9% month-over-month, after a 2.7% drop in January, which took the shipments index to its lowest level since July 2020.
But the shipments index declined 5.5% in February versus the same period in 2024.
The monthly report from Cass and partner Tim Denoyer of ACT Research is based on data from the billions of dollars of freight bills that Cass pays for its shipper clients.
The index covers several modes but is weighed towards full truckload.
After rising 13% in 2021 and 0.6% in 2022, the shipments index declined 5.5% in 2023 and 4.1% in 2024, and so far is trending toward another decline in 2025, Cass says.
The Expenditures Index, which measures the total amount spent on freight, was up 3.6 % month-over-month in February, while year-over-year expenditures declined 4.6% from 4.2% in January.
The expenditures component of the Cass Freight Index, after a record 38% surge in 2021 and another 23% increase in 2022, fell 19% in 2023 and 11% in 2024, in good news for shippers.
But Cass says that after the decline in 2024, freight rates are starting in 2025 on track for low- to mid-single-digit increases in 2025.
Another look at rates comes from the Cass Linehaul Index, which measures US per mile truckload rates before fuel surcharge and other accessorials.
In February, the Linehaul Index rose 1.2% month-over-month, the sixth straight small increase from a cycle low in August. The index was 4.8% above that August low in February.
The year-over-year change accelerated to a 1.9% increase in February after a 0.8% rise in January.
“This index fell 10% in 2023 and another 3% in 2024. Where it will go in 2025 is a big question,” Denoyer says.
In some interesting concluding comments, he adds that “while the outlook is fraught with uncertainty, and freight demand will be challenged by tariffs, we highlight a silver lining for the for-hire freight market amid rising recession risk. Elevated uncertainty may be turning the tide of private fleet capacity additions after a long for-hire downturn.”
(See More Below)
Denoyer for many months has cited aggressive moves by private fleets to leverage their unused capacity to act as carriers for others has been a market drag on the for-hire market.
Each month, Cass nicely summarizes the state of freight, as seen in the graphic below for February:
Source: Cass
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