Cass Freight Index points to lower March shipments and expenditures readings

Freight shipment and expenditure readings again saw declines in March, according to the most recent edition of the Cass Freight Index, which was recently issued by Cass Information Systems.

Many freight transportation and logistics executives and analysts consider the Cass Freight Index to be the most accurate barometer of freight volumes and market conditions, with many analysts noting that the Cass Freight Index sometimes leads the American Trucking Associations (ATA)  tonnage index at turning points, which lends to the value of the Cass Freight Index. What’s more, the Cass Transportation Indexes accurately measure changes in North American freight activity and costs based on $44 billion in paid freight expenses for the Cass customer base of hundreds of large shippers.  

March’s shipment reading—at 1.155—was down 4.0% annually and fell 1.0% compared to February, which was down 0.3% compared to January’s 1.124 reading. That was preceded by a 3.9% annual increase in December, a 0.4% November decrease and a 3.9% annual gain in December. It also trailed August’s 1.278 reading, which marked the highest level for shipments since May 2018. On a two-year stacked change basis, March shipments were up 3.4% and down 3.8% on a month-to-month seasonally adjusted (SA) basis.  

The report’s author, Tim Denoyer, ACT Research vice president and senior analyst, wrote that the decline in shipments come as freight markets continue to work through an extended soft patch. What’s more, he observed a key difference in the March shipment data compared to January and February was that mild weather this winter and the Omicron variant in early 2022 both supported volume comparisons in January and February, making the lower result in March not surprising.

“Soft retail sales trends and ongoing destocking remain the primary headwinds to freight volumes, and sharp import declines suggest this type of environment will persist for some time,” he wrote. “Normal seasonality from the March level suggests 1%-3% y/y declines for the next few months.”

The March expenditures reading—at 3.961—was down 12% annually and fell 1.5% below February’s 4.020 reading. Expenditures were up 17.2% on a two-year stacked basis and down 2.8% on a month-to-month seasonally adjusted (SA) basis.  

Denoyer observed that the expenditures component of the Cass Freight Index rose 23% in 2022, following a record 38% increase in 2021, “but is set to retrench in 2023.”