Freight shipments stabilized in April, with the shipments component of the Cass Freight Index down 4.4% year over year but increasing 0.4% from March. This marks a third straight sequential increase in volumes, which is an encouraging signal for a potential second-half recovery. However, normal seasonal trends would result in a 1.7% y/y increase in the shipments index during the back half of the year.
The Cass Freight Index reported that freight shipments stabilized in April, with capacity constraints pushing rates to recent highs. This trend is expected to continue, with higher fuel prices and rising interest rates weighing on demand. As a result, s expect tighter capacity and higher rates from here.
Capacity constraints have been a major driver of the surge in TL linehaul rates. The Cass Freight Index reported that the TL linehaul index surged 5.6% y/y, registering the largest y/y increase since August 2022. This trend is expected to continue, with tighter capacity and higher rates from here.
The freight cycle is being led by the supply side as noncompliant drivers are being forced out of service. The Cass report concluded that new FMCSA regulations have acted as a catalyst, resulting in tighter capacity and higher rates from here.
Cass' expenditures index, which measures total freight spend including fuel, was up 3.5% y/y and 2.6% higher than March. Higher diesel prices and core freight rates were the drivers of the increase. This trend is expected to continue, with higher fuel prices weighing on demand.
The dataset, which includes for-hire spot and contract rates, has been up y/y in 16 straight months. The Cass Freight Index reported that the shipments component of the index was down 4.4% year over year but increased 0.4% from March.
Shipper demand exceeded expectations throughout the first quarter and has remained steady since, according to J.B. Hunt. This trend is expected to continue, with tighter capacity and higher rates from here.
The Cass report cautioned that 'higher fuel prices sapping consumer spending, and rising interest rates sapping the housing market' are weighing on demand. s expect tighter capacity and higher rates from here.
Data used in the indexes comes from freight bills paid by Cass, a provider of payment management solutions. The company processes $37 billion in freight payables annually on behalf of customers.
s expect higher fuel prices and rising interest rates to weigh on demand.
