Truck, ocean freight trending up

According to two reports released by research analysts, both domestic U.S truck freight and inbound ocean freight are presenting a positive trend

According to two reports released by research analysts, both domestic U.S truck freight and inbound ocean freight are presenting a positive trend. FTR Associates’ latest Trucking Conditions Index (TCI) , as reported in the firm’s February 2012 Trucking Update, increased in December to a reading of 7.0. That marks the third consecutive month that the reading has climbed, reflecting an improving climate for truckers as U.S. economic fundamentals strengthened during last year’s fourth quarter, noted FTR.

FTR explained that capacity pressures from a forecasted 4% growth in truck loadings alongside driver-recruitment challenges should keep its index “in good positive territory throughout 2012.”

The firm’s TCI is derived from a compilation of factors affecting trucking companies. Any reading above zero indicates an “adequate trucking environment” with readings above 10 a sign that volumes, prices and margin are “in a good range for trucking companies.”

“Demand for truck transport continues to grow at rates outstripping the growth in GDP,” said Larry Gross, FTR senior consultant. “We believe this growth trend will continue, barring an exterior shock to the economy, such as an uncontained European default situation or a disruption emanating from the Mideast. Growth should be sufficient to keep the balance firmly in favor of trucking carriers throughout the year.”

Meanwhile, according to a report issued by Baird Equity Research, weak international ocean and air freight demand persists and air freight volume growth remains negative, albeit volumes were modestly above seasonal rates.

However, Baird went on to note that North American ocean freight import growth is modestly positive and that air freight seasonal export trends to North America and Europe were both “better than seasonal.”

Specifically regarding North American ocean freight, Baird reported that LA/Long Beach December import growth was 2% year-over-year (YoY), in line with the overall North American trend. North American import volume grew roughly 2% YoY in December, marking a second consecutive month of “modest” positive growth. Baird noted that the above-seasonal demand trend likely reflects the earlier Chinese New Year as well as improved consumer and business sentiment seen in recent months.

Baird added that total exports at top North American ports increased 5-6% YoY “fueled by 7% export growth off the West Coast and 4% export growth off the East Coast. Total throughput at top North American ports increased roughly 2% YoY.”

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