February was a good month for the trucking business, as tonnage rose to an all-time high and rates for truckload shipments ticked up slightly from a year ago.
The American Trucking Associations’ seasonally-adjusted truck tonnage index rose 7.2% in February from a month earlier. At 144, the index was up 8.6% from February of 2015, and it dwarfed the previous all-time high of 134.7, notched in December
Volumes in other parts of the supply chain--particularly seaports--also grew in February. Several trucking companies, including Old Dominion Freight Line Inc. and Saia Inc. have said volumes are up, and transportation stocks have surged recently.
“It’s encouraging,” said Jett McCandless, chief executive of freight and logistics consultancy CarrierDirect.
Last month’s strong volumes come after many analysts had predicted a lackluster 2016 for the freight business, particularly in the first half of the year.
A monthly report by Cass Information Systems Inc. showed that per-mile truckload rates were 0.5% higher this February compared to the same month last year. But the rates were down month-to-month, reaching their lowest point since last summer. Cass analysts attributed the decline to softening demand and overcapacity in the truckload market.
Mr. McCandless said many national carriers are doing well, but smaller regional carriers are losing market share and “feeling the biggest pain from this mixed-results economy.”
“There’s been some exciting demand, but let’s put shape on the word ‘exciting,’” Mr. McCandless said. “It’s exciting for what their expectations were for 2016.”
Shares in trucking companies fell on Tuesday along with many transportation stocks in the wake of the bombing attacks in Brussels. By mid-day, shares at less-than-truckload carriersYRC Worldwide Inc. was down 3.3%, while Saia was off 1.7% and Old Dominion down 0.9%.
Mr. Costello also pointed to the most recent U.S. Census report showing a high ratio of inventories to sales in the supply chain. “We need those inventories reduced before trucking can count on more consistent, better freight volumes,” he said.