The recovery of congestion laden West Coast ports significantly impacted shipment volumes and expenditures, according to the latest Cass Freight Index Report.
According to the latest Cass Freight Index Report, North American shipment volumes and expenditures increased again in March 2015. The logistics payment solutions provider attributed the growth primarily to the increase in cargo from West Coast ports, which had been slowed considerably by congestion in prior months.
Cass noted the U.S. and global economies did not grow as much as expected in the first quarter despite the increase in freight movement in the U.S.
Overall shipment volumes rose 0.3 percent in March compared to February, but fell 5.1 percent compared to March of 2014. Rail shipments grew 4.2 percent for carload traffic and 12.6 percent for intermodal, after falling in February.
Truck shipments, on the other hand, were down in February (the latest month for which figures were available) thanks to due to bad winter weather in most of the country. DAT Solutions’ spot market freight volume indexes, however, increased 34 percent in March compared to February and DAT reported freight availability decreased 28 percent.
“The labor problems on the West Coast contributed heavily to lower imports, which have fallen for two consecutive months,” Cass said in a statement. “April is usually the start of the spring shipping season, and the upturn in March for both rail and truck signals improved conditions ahead.”
Freight expenditures grew 1 percent in March, following a 4.3 percent increase in February, but payments were still 3.5 percent lower than in March of 2014. Cass noted rates are rising, especially as capacity tightens in many markets. DAT Solutions reported van rates increased 2.8 percent in March, flatbed rates were up 2.8 percent and reefer rates grew 1.7 percent for the month.
According to DAT, monthly average rates have now increased year-over-year for more than 20 consecutive months.
“First quarter freight volumes were affected by labor problems, slowdowns and work stoppages at West Coast ports; extreme winter weather throughout much of the country; and a slowdown in the global economy,” said Cass. “The ports are now dealing with fallout from the labor issues – both good and bad: the Port of Portland in Oregon had two of its biggest container carriers, Hanjin and Hapag-Lloyd, drop the port because of slow and unpredictable service stemming from protracted union labor issues. Other ports around the U.S. have been reporting higher container shipments as carriers try other options. After a rough few months, freight volumes overall were building strongly toward the end of the quarter. With that growth, we will see rate increases that may outpace the growth in volume.”
The Cass Freight Index is based on domestic freight shipments of hundreds of the company’s clients across a wide variety of industries. Cass Information Systems processes more than $26 billion in annual freight payables.
North American freight volumes on the rise in March
