North American shipment volumes and total spending on freight both dropped in January, according to the Cass Freight Index, but they were also at their highest level for the month in at least three years.

The number of shipments fell 4.7% from December, but moved 2.7% higher from the same month a year ago, with the January shipments index at its highest level for the month since January 2012.

Freight spending continued falling for the third consecutive month in January, dropping 5.7% from December, but was 3% higher compared to the same time in 2014 and was the highest January index level on record for expenditures.

The Cass Freight Index measures trends in North American shipping activity based on $23 billion in paid freight expenses for hundreds of large shippers.

The continuing labor and capacity woes at West Coast ports had an impact on shipment volume late in December, which is reflected in the January 2015 indexes, according to the report.

It noted the American Trucking Associations reported that the growth in tonnage was flat at year-end, while U.S. railroads experienced some substantial increases in carloads and intermodal recently. However, the indexes did not capture a portion of these increases because the big growth occurred in commodities such as coal, sand and grain, which often move in large bulk or dedicated unit train moves, according to Rosalyn Wilson, supply chain expert, and senior business analyst with the management services firm Parsons, who provides analysis for the report

When it came to the decline in freight expenditures she said much of it can be attributed to the fall in the number of shipments, while also partially due to the weak freight market which held rates in check.

“With carriers gaining more control over rates and capacity tightening, total freight spend in 2014 was higher than in any preceding year. As long as capacity remains precariously balanced, we will continue to see a slow trend upwards,” Wilson said. “But when the economy picks up later this year we should see a steeper rise in total dollars spent, reflecting higher freight rates. It is important to note that freight volume has not yet returned to pre-recession levels, but that spending on freight is substantially higher than it was in 2007."

She cautioned recent numbers show declines in U.S. manufacturing in terms of new orders and order backlog, though not unexpected for January, which could signal more than a temporary drop in shipments in coming months.

According to Wilson the U.S. economy is currently on pretty solid ground, with growth bringing with it higher transportation costs.

“It is also good news for carriers, as most of the industry is in agreement that the ability to control rates is shifting back into the hands of carriers and that rate increases will be significant. However, sustained growth in 2015 will exacerbate the capacity problems experienced in 2014,” she said. “Carriers do not currently have the necessary capacity, infrastructure and systems to efficiently move goods as freight volume rises in 2015."

Wilson said bad weather; labor problems; fleet capacity issues for truck, rail and other equipment, especially container chassis; and inadequate infrastructure will combine to not only create new freight bottlenecks, but also to push up the cost to move freight. “Fleet capacity and especially infrastructure issues cannot be corrected in the short term, despite aggressive investment plans already announced by carriers."