Slow off the mark

Stronger US retail sales lifting truckload volumes , but not rates

By William B . Cassidy

US truck and rail freight volumes appear to be increasing slowly , but those gains haven ’ t fueled an increase in truckload rates , according to new data .

The Cass Freight Shipments Index rose 1 % sequentially in August after increasing 3 % in July , Cass said in its monthly report , released Sept . 16 .

US truckload spot rates tracking close to 2023 levels

Average US truckload spot rates , in USD per mile , excluding fuel surcharges

USD average rate per mile

$ 2.4 $ 2.2 $ 2.0 $ 1.0 1.8 $ 1.6 $ 1.4 $ 1.2

Those gains track increases of 0.1 % and 1.1 % in total US retail trade and food service sales in August and July , respectively , according to monthly data from the US Census Bureau , also released on Sept . 16 .

Retail sales in August were up 2 % year over year , according to advance estimates , and e-commerce sales were up 7.8 % from August 2023 . That ’ s a stronger showing than the Census Bureau expected .

On Sept . 17 , S & P Global Market Intelligence raised its forecast increase in third-quarter consumer spending to a “ solid ” 3.5 %.

“ We estimate the price index for total retail sales fell 0.1 % in August and is down 0.7 % from a year ago ,” S & P Global , parent company of the Journal of Commerce , said in a statement . In the prior 12-month period that ended in July , the retail sales price index was up 1.3 % year over year .

The change in the index reflects the waning impact of inflation . Consumer price inflation fell to 2.5 % in August , a three-year low but still above the pre-pandemic norm .

But the increase in retail and food and beverage purchases hasn ’ t moved truckload pricing . The Cass Truckload Linehaul Index dropped 0.6 % in August from July , the fourth straight month-over-month decline . The index , which tracks long-haul spot and contract rates , rose slightly from February through April . On an annualized basis , the linehaul index dropped 3.3 % in August and 3.2 % in July .

Average dry-van truckload spot rates from DAT Freight & Analytics continued to closely track last year ’ s prices through early September . The US average dry-van rate , excluding fuel surcharges , was up 3 % at $ 1.61 per mile in the week ending Sept . 7 .

“ Downward pressure on the larger contract market is lessening , but recent slight increases in spot rates are not yet enough to turn contract rates higher ,” Cass said in its report .

The US producer price index ( PPI ) for long-haul truckload transportation was almost unchanged in August ,

$ 1.0 L

Jan 2023

Jul

Jan 2024

Jul

Dry Van Flatbed Refrigerated

US truckload costs stem 19-month yoy decline in August

US long-haul truckload producer price index ( PPI )

219

210

200 140 190

180

170 L Jan 2023 Jul Jan 2024

Aug Jul , 2024

TL PPI

Notes : US BLS producer price indices are based on selling prices for trucking services

Source : US Bureau of Labor Statistics data , JOC analysis

32 Journal of Commerce | October 7 , 2024 www . joc . com

October 7, 2024 | Page 32

Slow off the mark