For-hire US truck tonnage rose in August after falling for four consecutive months, climbing 0.5 percent on a seasonally adjusted basis from July as contract carriers handled more freight, the American Trucking Associations (ATA) said Tuesday. The seasonally adjusted index fell 1.1 percent in July. Year to date, the ATA For-Hire Truck Tonnage Index is down 0.2 percent year over year.
The actual, unadjusted increase in tonnage hauled by for-hire carriers was even greater: 2.2 percent from July, according to ATA, following a 3.2 percent drop in July from June. Trucking’s typical seasonal midsummer slump ended early this year as consumer demand remained high and waves of imports arriving at US ports began to move inland, more often by truck rather than intermodal rail.
The ATA index is weighted heavily toward contract freight, as opposed to spot freight, ATA chief economist Bob Costello said in a statement. The increase in August may reflect the shift of some freight to contract carriers as shippers sign annual agreements that include rate increases. It also likely reflects strong demand that pushed up volume levels despite ongoing supply chain disruption.
“August’s monthly gain, while small, was the first since March” on a seasonally adjusted basis, Costello said. The more volatile unadjusted numbers likely reflect the jagged impact of goods and labor shortages across supply chains. The unadjusted tonnage index numbers, representing actual tonnage hauled, have been higher than the seasonally adjusted numbers since May, a sign tonnage is lower than expected.
In contrast to the spot market, the contract market, as measured by ATA’s tonnage index, has yet to recover its pre-pandemic freight volumes. The seasonally adjusted index hit a high of 119.1 in February 2020 (the 2015 average equals 100), and the unadjusted index peaked at 120.9 in March 2020. Costello blamed shortages of labor, equipment, and goods and products, such as semiconductors.
The DAT Freight & Analytics Truckload Volume Index, which measures both spot and contract volumes, was up 2 percent in August from July and 17 percent year over year. The ATA tonnage index was down 0.5 percent year over year in August. The gap between the two indices underscores the growth in the truckload spot market as contract carrier capacity tightened during the COVID-19 pandemic.
The number of loads posted to DAT spot market load boards jumped 11.9 percent in August from July, another sign of strong demand for truckload capacity and an early start to trucking’s peak season.
Spot volumes tracked by technology company and spot marketplace Truckstop.com rebounded from a Labor Day decline in the week ended Sept. 17, with total volumes jumping 25.9 percent to exceed the volume in the week prior to Labor Day. Dry-van load availability rose 23.9 percent last week, and dry-van spot rates were about 16 percent higher than a year ago, according to Truckstop.com.
The monthly indices and weekly data indicate demand will further tighten truckload capacity, in turn affecting other sectors also facing capacity constraints, keeping rates elevated.
Source: Journal of Commerce