Newly released figures show the Cass Truckload Linehaul Index once again remained higher in May than in each of the past three years, coming in 3.5% higher than May 2014 and 9.5% higher than two years ago.
Newly released figures show the Cass Truckload Linehaul Index once again remained higher in May than in each of the past three years, coming in 3.5% higher than May 2014 and 9.5% higher than two years ago.
Despite the year-over-year increases, the reading of 122.8 in May is down 2.5% from the month before and follows a 0.4% April decline, while the reading is at its lowest level since last August.
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The index is an indicator of market fluctuations in per-mile truckload pricing, isolating the linehaul component of full truckload costs from other components, such as fuel and accessorials, providing a reflection of trends in baseline truckload prices.
According to the investment banking firm Avondale Partners, which provides analysis of the index, with demand increasing and capacity remaining extraordinarily tight, it expects contract rate increases will continue to filter into the index at higher levels.
“We would point out that contract pricing, which applies to more than 95% of the public carriers' freight, has been accelerating after a drawn-out bid season last year,” said Avondale. “As a result, although spot market pricing has decelerated somewhat, it remains strong. We are not surprised to see our index continue to post mid-to-high single digit gains and we expect this to continue.”
Avondale said it sees truckload pricing increasing between 4% and 9% in 2015, depending on how much rate increase each carrier was successful in obtaining in 2014 and when those rate increases were achieved.
A separate report, the Cass Intermodal Price Index, show total intermodal costs fell 3.1% year-over year in May.
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The index registered 129 for May, 3.9% lower than in April. This is also its lowest level since November of last year.
“As lower fuel surcharges continue to affect the cost of truckload shipping (the truckload index does not take fuel into account), many loads are shifting from intermodal to truckload,” said Avondale. “That said, however, intermodal rates seem to mirror changes in fuel and remain competitive. Additionally, efforts to shift modes continue to be challenged by limited capacity.”
The Cass Intermodal Price Index is an indicator of market fluctuations in per-mile U.S. domestic intermodal costs. It includes all costs associated with the move, such as linehaul, fuel and accessorials.
Data within this index and the truckload index is derived from actual freight invoices paid on behalf of Cass’ clients, which totaled over $23 billion in 2013.
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