Truck Tonnage Increases 2.3% in February
[Stay on top of transportation news: Get TTNews in your inbox.]
Truck tonnage in February increased 2.3% compared with the same month in 2022, according to American Trucking Associations’ For-Hire Truck Tonnage Index, marking the 18th straight year-over-year gain and the largest since October.
On a sequential basis, February’s number was up 1.2% after increasing 0.6% in January.
In February, the index equaled 118.4 (2015=100), compared with 117 in January.
ATA Chief Economist Bob Costello on March 21 said that contract freight remains strong.
“Tonnage has increased sequentially for the last three months totaling 2.9%,” Costello said. “As a result, the index is just 0.3% below the recent high in September. The fact that our index is growing sequentially and on a year-over-year basis demonstrates that contract freight continues to hold up at high levels.”
Costello pointed out that the tonnage number has remained steady and continues to increase incrementally month-to-month, rising 1.4% in January compared with 2022. Tonnage increased 3.5% for all of 2022.
“Looking ahead, we continue to see evidence the inventory cycle is improving, which means bloated stocks will stop being a headwind and eventually help truck freight volumes,” Costello said. “Increased infrastructure spending will also boost volumes heading into the summer months. However, we expect to see continued freight softness related to lower home construction and slowing factory output.”
Trucking serves as a barometer of the U.S. economy, representing 72.2% of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods. Trucks hauled 10.93 billion tons of freight in 2021. Motor carriers collected $875.5 billion, or 80.8% of total revenue earned by all transport modes.
ATA calculates its monthly tonnage index based on surveys from its membership, and has been doing so since the 1970s.
While the ATA figure is up, the monthly report from the Logistics Managers' Index indicates positive growth in transportation in February but at a much slower pace. When measured against 2022’s skyrocketing figure of 75.2, the 2023 LMI was 54.7. When February’s figure is compared with January, it showed a drop from 57.6.
“February is often a low point seasonally due to the consumer spending hangover from the holidays in the U.S. combined with slowness in imports due to Chinese New Year, and that was certainly reflected this year,” Dale Rogers, professor of business at Arizona State University, said in his report. “We are hoping that they will pick back up sometime in the second quarter as retailers begin to rebuild inventories ahead of back-to-school and holiday shopping, but as of this moment, that has yet to materialize.”
Every month, researchers at Arizona State University, Colorado State University, Rochester Institute of Technology, Rutgers University and the University of Nevada-Reno, in conjunction with the Council of Supply Chain Management Professionals, assemble the report. An LMI reading above 50 indicates the logistics sector is expanding; a reading below 50 indicates a contraction.
“Consumers are still spending, just in different ways than they were during the pandemic. This is most reflected in the movement away from goods and back toward services,” Rogers said. “U.S. consumers are now dedicating 33% of their spending toward goods, similar to pre-pandemic levels of 30%.”
Meanwhile, DAT Freight and Analytics said truckload freight volumes slipped in February and demand for spot market truckload services declined to its lowest level since May 2020.
DAT also said the pricing environment for truckload services weakened during the previous month, with the national average spot van and refrigerated rates declining to levels not seen since September 2020.
“Truckload volumes retreated while the spread between spot and contract rates expanded to where they were before the holidays,” DAT Chief of Analytics Ken Adamo said. “February volumes and spot rates gave carriers little incentive to move away from contracted freight.”
DAT said its Truckload Volume Index for van freight was 207, down 8% compared with January and 5% lower year-over-year. The refrigerated TVI fell to 162, 7.9% lower month-over-month and down 4.7% year-over-year. The flatbed TVI was virtually unchanged at 217 and 7.9% higher year-over-year.
Joel Morrow of Alpha Drivers Testing & Consulting traveled across America asking one simple question: What if a trucker designed a truck? Hear the program above and at RoadSigns.TTNews.com.
DAT said it is not uncommon for the number of loads moved to be lower compared with January in part because February is a shorter month.
DAT said the spot van rate was $2.24 a mile, down 14 cents compared with January and 63 cents less than the average contract van rate. The spot van rate in February was the lowest monthly average since August 2020 and down 85 cents year-over-year.
The spot reefer rate dropped 19 cents to $2.59 a mile, 57 cents less than the average contract rate for reefer freight. The rate was 95 cents lower year-over-year and the lowest monthly average since October 2020.
The flatbed rate fell by 6 cents to $2.70 per mile, 73 cents lower than the average contract rate and 51 cents less year-over- year.
Want more news? Listen to today's daily briefing below or go here for more info: