Good news heading into the weekend. The price of oil is on yet another ride down as swelling global supplies overwhelm rising but still relatively weak demand.
The price of oil has fallen close to its lowest price in six years, and many expect it to fall much further in the coming weeks because supplies are still heading up and the summer driving season is still months away.
Department of Transportation
The Freight Transportation Services Index (TSI), which is based on the amount of freight carried by the for-hire transportation industry, fell 0.2 percent in January from December, declining for the second consecutive month, according to the U.S. Department of Transportation’s Bureau of Transportation Statistics’ (BTS). The January 2015 index level (122.9) was 29.9 percent above the April 2009 low during the most recent recession. U.S. Department of Transportation Office of Public Affairs 1200 New Jersey Avenue, SE Washington, DC 20590 http://www.dot.gov/briefingroom
Cass Information Systems
North American shipment volume jumped up in February, while total freight expenditures reversed a three- month slump. The problems caused by labor negotiations on the West Coast have contributed to an economic slowdown for most of the first quarter. The two sides in the ILWU contract negotiations have come to terms, but not yet ratified them, which will open the floodgates to moving the backlogged freight. The Port of L.A. estimates that it will take three months to return to normal. Meanwhile congestion and capacity will be the industry’s buzzwords.
Some economic indicators have not bounced back as well as others in the recovery from the Great Recession, but trucking is doing well, and a capacity crunch leads economic expert John Larkin to project truckload rates to rise 3 to 5% this year overall.
Larkin, managing director and transportation expert for investment firm Stifel, Nicolaus, offered an economic outlook Tuesday morning during the Truckload Carriers Association annual meeting in Kissimmee, Fla.
February saw freight volume drop 37% year-over-year and spot market freight availability decline for the second consecutive month — yet rates were up year over year, according to the latest DAT North American Freight Index.
Bureau of Transportation Statistics
U.S.-NAFTA freight totaled $95.8 billion in December 2014 as four out of five transportation modes – truck, rail, air, and pipeline – carried more U.S.-NAFTA freight than in December 2013, according to data released today by the U.S. Department of Transportation’s Bureau of Transportation Statistics (BTS) (Table 1). Year-over-year, the value of U.S.-NAFTA freight flows by all modes increased by 5.4 percent, with December marking the 11th consecutive month of year-over-year increases.
American Trucking Associations
American Trucking Associations’advanced seasonally adjusted For-Hire Truck Tonnage Index increased 1.2% in January, following a revised gain of 0.1% during the previous month. In January, the index equaled 135.7 (2000=100), an all-time high.
U.S. oil-company job cuts that cost machinery operator Drew Sanford his spot at Halliburton Co. are shaping up as a boon for truckers desperate for big-rig drivers.
Already equipped with a commercial license, the 30-year-old Sanford left North Dakota and landed at Oklahoma City-based Stevens Trucking Co. He is sometimes on the road as long as four days at a stretch, but the working conditions are good, he said, and “I’ll probably just stick here for a while.”
While good in theory, shippers say, the result would be impracticable, expensive, difficult to enforce, and might end up doing more harm than good.
“Even if the rules were legally sound and well-designed (which they are not), Federal Motor Carrier Safety Administration (FMCSA) cannot credibly assert that its proposed rules can be implemented with no costs or other adverse impacts to shippers and intermediaries, or to the transportation system of which the trucking industry is the most important part,” the National Shippers Strategic Transportation Council (NASSTRAC) said in comments to the agency.
U.S. Department of Transportation
The Freight Transportation Services Index (TSI), which is based on the amount of freight carried by the for-hire transportation industry, was virtually unchanged in December from November, failing to rise after five consecutive months of increases, according to the U.S. Department of Transportation’s Bureau of Transportation Statistics’ (BTS). The December 2014 index level (123.8) was 30.9 percent above the April 2009 low during the most recent recession.