Trucking news: Cass Freight Index is up in September

Even though the economy remains stuck in neutral, it appears that the trucking market may be gaining some sustained momentum, based on the September edition of the Cass Information Systems Freight Index.

For the second straight month, the index, which measures the number of shipments and expenditures that are processed through Cass’s account payable systems, showed growth, and has been up in six of the last seven months.

September shipments at 1.116 were 1.9 percent higher than August’s 1.095 and have been over the 1.0 mark for five straight months, with May marking the first time shipments topped 1.0 since November 2008.

September shipment expenditures at 2.031 were 2.9 percent higher than September’s 1.971 and 9.8 percent higher than July’s 1.832 and 23.4 percent higher than September 2009’s 1.556.

Many trucking industry executives and analysts consider the Cass Freight Index as an accurate barometer of freight volumes and market conditions, with Credit Suisse analyst Chris Ceraso stating in research notes that the Cass Freight Index sometimes leads the American Trucking Associations (ATA) tonnage index at turning points, which lends to the value of the Cass Freight Index.

The ATA recently reported that its seasonally-adjusted August tonnage index was down from July and up year-over-year.

As LM has reported, in the first half of 2010, many shippers, carriers and analysts said they were optimistic about the trucking market, especially when comparing it to 2009. But since then there have been various economic reports, including today’s federal government report that second quarter GDP growth fell to 1.7 percent from the first quarter, and others which indicate the recovery is slowing down.

Some other signs of a slowing economy are also evident, with unemployment still high, retail sales down, and consumer confidence falling. These factors all have the potential to bring tonnage growth down in the coming months.

And at last week’s Council of Supply Chain Management Professionals Annual Conference in San Diego many shippers and carriers indicated that there is an underlying sense of caution in play when assessing trucking volumes and where they may be heading in the coming months.

One recurring theme heard from CSCMP attendees was that whatever recovery is occurring may now be led by manufacturing, rather than consumer spending, which typically accounts for 70 percent of all economic activity.