Rate gains for both truckload and intermodal activity remains an ongoing theme, based on data in the the most recent editions of the Truckload Linehaul Index and Intermodal Index from Cass Information Systems and Broughton Capital.
This pricing data is part of the Cass Truckload Linehaul Index and the Cass Intermodal Linehaul Index, which were both created in late 2011. The indices are based on actual freight invoices paid on behalf of Cass clients, which accounts for more than $23 billion annually and uses 2005 as its base month.
According to Cass and Broughton Capital, the truckload index “isolates” the linehaul component of full truckload costs from other components such as fuel and accessorials, which, in turn, provides an accurate reflection of trends in baseline truckload prices.
Truckload rates, which measure linehaul rates, saw a 7.2% annual gain to 133.5 in March, heading up sequentially for the fifth consecutive month and annually for the 12th consecutive month. What’s more, this represents the largest annual increase going back to January 2015, showing further evidence of truckload pricing gaining momentum, the report said.
“Our realized contract pricing forecast for 2018 is 6% to 8%, and current data is signaling that the risk to our estimate may be to the upside,” wrote Broughton Capital Managing Director Donald Broughton in the report. “The current strength being reported in spot rates is leading us to believe contract pricing should keep rates in positive territory well throughout 2018.”
In previous reports, Broughton cited other factors driving pricing gains, including:
Total intermodal pricing in March was also very positive, rising 5.8% annually in March to 143.2 for a new all-time high. This follows annual gains of 5.4% in February, 5.0% in January, and 4.0% in December.
This tally also marks 18 consecutive monthly gains of annual intermodal pricing gains, with the three-month moving average up 5.4% annually, as intermodal is seeing the benefits of tight truckload capacity and higher diesel prices creating incremental demand and domestic intermodal pricing power, the report noted.
“Longer term, we continue to foresee oil trading in the $45 to $65 range and diesel in the $2.50 to $3.25 range throughout 2018 (without the refining interruption pressure produced by hurricanes or other catastrophic events),” wrote Broughton.