Truck Tonnage Extends Streak of Gains in January
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Truck tonnage in January rose 1.2% when measured against year-ago levels, marking the fifth consecutive month for a year-over-year increase, American Trucking Associations said.
The federation’s For-Hire Truck Tonnage Index equaled 115.5 compared with 114.6 in January 2021.
Measured against December 2021, the index rose 0.6%.
“In January, truck tonnage was helped by rising retail sales and factory output,” said Bob Costello, chief economist at ATA. “While housing starts fell last month, which is another important driver of truck tonnage, it remained at high levels.”
He noted tonnage is on a healthy upward streak.
“January’s gain was the sixth straight, totaling 4.4%,” Costello said. “The index, which is dominated by contract freight with only small amounts of spot market truck freight, is off 3.9% from the all-time high in August 2019 and only 1.5% below March 2020, when the pandemic hit.”
For all of 2021, Costello said truck tonnage increased 0.3% compared with a decline of 4% in 2020 when measured against 2019, and it’s another indication the U.S. economy is bouncing back as the COVID-19 pandemic shows signs of receding.
“In January, truck tonnage was helped by rising retail sales and factory output. While housing starts fell last month, which is another important driver of truck tonnage, it remained at high levels,” he said.
Trucking serves as a barometer of the U.S. economy, representing 72.5% of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods, according to ATA.
ATA calculates the index based on surveys from its membership and has been doing so since the 1970s.
The Logistics Managers Index also shows the trucking and overall economy remain in a robust growth mode. January’s LMI was 71.9 compared with 67.2 a year ago and January’s reading was 1.8 points higher than December’s 70.1.
The report said January’s results marked a full year of readings of more than 70.0, which it categorizes as significant expansion.
“Much like diets and gym memberships, January is a time of renewal in supply chains, allowing logistics networks to reset post-holiday. After this reset, firms can then began ramping back up for demand throughout the year,” said Dale Rogers, a business professor at Arizona State University. “This year, activity is already elevated in January. It will be interesting to observe the next 12 months, and whether this portends continued growth, or if the price will be too high eventually for demand to continue to grow.”
Every month researchers at some of the nation’s leading universities, including 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, put together the report. Any reading of the LMI calculated above 50 indicates that logistics is expanding; a reading below 50 is indicative of a shrinking logistics industry.
Meanwhile with the trucking industry still struggling to find qualified drivers and freight surging, the latest report from DAT indicates both contract rates and spot market rates are surging to record or near-record levels.
Now at $3.11 per mile, the national average spot rate for van freight is 99 cents higher year-over-year, and increased 11 cents compared with December.
The national average rate for reefer loads on the spot market increased 12 cents to $3.59 per mile, up 98 cents compared with January 2021.
The average spot flatbed rate rose 6 cents to $3.14 a mile in January. The spot flatbed rate has been above $3 a mile for nine consecutive months and is 64 cents higher year-over-year.
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The national average shipper-to-broker contract van rate was $2.98 per mile, up 4 cents month over month. The average contract reefer rate edged up 3 cents to $3.16 a mile and the average contract rate for flatbed freight was down 1 cent to $3.33 a mile.
“Load-to-truck ratios on the DAT load board network hit record highs for January, a sign of exceptionally strong demand for truckload services,” said Ken Adamo, chief of analytics at DAT. “While the number of loads moved gradually eased throughout the month, tight capacity and disruptions due to winter weather and COVID-19 helped push rates to historic levels.”
DAT said its Truckload Volume Index was 229 last month, the highest ever number for a January and up 15% year-over-year. However the index was down 3.8% when measured against December’s TVI, which included the holiday shopping season and a record year for retail sales, both online and traditional brick-and-mortar sales. DAT also said the number of loads posted to its DAT One load board network increased 104.7% compared with January 2021 and they are up 37.4% compared with December.
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