Cass Freight Index points to annual October gains
October freight shipments and expenditures saw annual gains and were mixed sequentially, 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.
October’s shipment reading—at 1.224—saw a 2.9% annual gain, falling short of the September’s 4.8% annual increase and was also below August’s 1.278 reading, which marked the highest level for shipments since May 2018. On a two-year stacked change basis, October shipments rose 3.7%, and were down 1.4% and 0.3% on a month-to-month and month-to-month seasonally adjusted (SA) basis, respectively.
“After a soft 1H’22, with freight demand hit by inflation, substitution from goods back to services, and now excess inventory, the improvement in the past few months is still a little puzzling,” wrote the report’s author Tim Denoyer, ACT Research vice president and senior. “It likely reflects a combination of: unique comparisons; inventory building ahead of the holidays; repositioning of mistimed inventory; consumers getting ahead of rising interest rates; [and] easing supply constraints, particularly in auto production. These are all temporary to varying degrees, and quickly declining import trends suggest they may end soon. Normal seasonality from here would have shipments slowing to flat y/y in November, down 5% y/y in December, and about flat for the year.”
On the expenditures side, the report said that October’s 4.399 reading marked an 11.1% annual increase, and rose 52.4% on a two-year stacked change basis. And it fell 4.9% and 4.0% on a month-to-month change and month-to-month change SA basis, respectively.
Denoyer observed that the Cass expenditures reading is comprised of changes in fuel, modal mix, intramodal mix, and accessorial charges. And he added that following normal seasonality from here, expenditure readings are likely to head down on an annual basis in December.
