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posted on 25 November 2016

Trucking Data Mixed In October 2016

Written by Steven Hansen

Truck shipments declined or improved in October - depending on the data source. Trucking, like rail, may be in contraction - but is likely improving.

Analyst Opinion of Truck Transport

This month it is agreed between the data sources that trucking sector is in contraction year-over-year. It was not agreed whether October was better than August. I tend to believe the CASS index which shows a moderate improvement month-over-month as it is more consistent with the rail data.

It is also interesting that the current trucking employment pattern resembles the period before the 2001 recession.

This situation is mirroring the trends in wholesale trade and manufacturing - which all remain in contraction. Prior to the New Normal, this would have indicated a recession - in 2016 it seems only to be indicating very weak near term economic conditions.

ATA Trucking

The American Trucking Associations' (ATA) trucking index decreased 0.3 % in October following a 6.3 % decline in September.

From ATA Chief Economist Bob Costello:

While seasonally adjusted tonnage fell, meaning the not seasonally adjusted gain wasn't as large as expected, the bottom of the current tonnage cycle should be near. There are some recent trends that suggest truck freight should improve, albeit gradually, soon.

Retail sales, housing starts, and even factory output all improved in October, which is a good sign. Most importantly, there has been considerable progress made in clearing out excess stocks throughout the supply chain. While that correction is still ongoing, there has been enough improvement that the negative drag on tonnage shouldn't be as large going forward.

Truck tonnage this month

z truck.jpg

Compared with one year ago, seasonally adjusted tonnage contracted 0.9 %.

Econintersect tries to validate ATA truck data across data sources. It appears this month that jobs growth says the trucking industry employment levels were up month-over-month. Please note using BLS employment data in real time is risky, as their data is normally backward adjusted (sometimes significantly).


This data series is not transparent and therefore cannot be relied on. Please note that the ATA does not release an unadjusted data series (although they report the unadjusted value each month - but do not report revisions to this data) where Econintersect can make an independent evaluation. The data is apparently subject to significant backward revision. Not all trucking companies are members of the ATA, and therefore it is unknown if this data is a representative sampling of the trucking industry.

source: ATA

FTR's Trucking Conditions Index for August Rises as New Regulations Tighten Capacity

FTR's Trucking Conditions Index (TCI) for August increased from July to a reading of 6.76. The TCI is continuing a steady rise that is expected throughout 2017, as new regulations tighten capacity resulting in better pricing and margins for trucking companies. This improvement is largely from the supply side, as currently the economy and freight markets are in a slow growth phase with unclear direction typical of a late recovery environment. The TCI is expected to peak in early 2018

source: http://www.ftrintel.com/news/latest-tci/index.php

CASS FREIGHT INDEX REPORT

Consistent with what many in the industry have been calling a "more than normal fall surge" in volumes, the Cass Shipments Index was up on a YOY basis for the first time in 20 months. We have seen a wide range of results in the different modes: from continued volume growth in parcel and airfreight driven by e‚Äźcommerce, to a sequential improvement in truck tonnage, to less bad rail and barge volume overall. Although it is far too early to make a
'change in trend' call, data is beginning to suggest that the consumer is finally starting to spend a little and that the industrial economy's rate of deceleration has eased. Simply put, the winter of the overall freight recession we have seen for over a year and a half in the U.S. may not be over, but it is showing signs of thawing.

Source: http://www.cassinfo.com/Transportation-Expense-Management/Supply-Chain-Analysis/Cass-Freight-Index.aspx



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