Year-over-year pricing dropped for the 17th consecutive month in May 2016, according to the latest Cass Intermodal Price Index, and analysts with Avondale Partners expect this trend to continue through the rest of 2016.
Intermodal rates fell another 2 percent in May 2016 compared to the same month last year, according to the latest Cass Intermodal Price Index, which measures all-in per-mile costs.
Cass Information Systems Inc., a logistics payment solutions provider and transportation intelligence analyst, said year-over-year rates were down for the 17th consecutive month. Intermodal rates dropped 3.4 percent year-over-year in April, 3 percent in March, and 3.8 percent in February.
The continued negative growth in rates is a record for the index, which was created in 2005. The previous record decline was set in the 13 months from Dec. 2008 through Dec. 2009.
Investment firm Avondale Partners reiterated its expectations for further declines in intermodal rates for the remainder of 2016 as the dramatic drop in diesel and crude oil prices continues to take its toll on U.S. domestic demand.
Although they predict that domestic container pricing may grow in the mid to low single digits through 2016, “that is dependent upon demand in longer lengths of haul growing fast enough to offset the loss of volume in shorter lengths of haul, particularly in the East,” Avondale added.
Intermodal rates fall another 2% in May
