The shipments component of the Cass Freight Index® rose 7.3% m/m in February, as operations recovered from weather effects and with a Leap Day, which was the main factor behind the 2.0% m/m increase in seasonally adjusted (SA) terms.
After rising 0.6% in 2022, the index declined 5.5% in 2023. With normal seasonality, the index will fall just 1% y/y in March and turn positive y/y in May.
See the Methodology for the Cass Freight Index
The Expenditures component of the Cass Freight Index, which measures the total amount spent on freight, rose 4.0% m/m, but fell 20% y/y in February.
With shipments up 7.3% m/m, we infer overall rates were down 3.1% m/m in February (see our inferred rates data series below).
This index includes changes in fuel, modal mix, intramodal mix, and accessorial charges, so is a bit more volatile than the cleaner Cass Truckload Linehaul Index®.
U.S. freight spending, as measured by the expenditures component of the Cass Freight Index®, fell 19% in 2023, after a record 38% surge in 2021 and another 23% increase in 2022. It is set to decline about another 14% in 1H’24, assuming normal seasonal patterns from here.
Cass Inferred Freight Rates are a simple calculation of the Cass Freight Index data—expenditures divided by shipments—producing a data set that explains the overall movement in cost per shipment. The data set is diversified among all modes, with truckload (TL) representing more than half of the dollars, followed by less-than-truckload (LTL), rail, parcel, and so on.
The rates embedded in the two components of the Cass Freight Index® declined 16% y/y in February, and have now declined 15%-21% for nine straight months.
The normal seasonal pattern from here would put inferred rates down 13% y/y for 1H’24, and down 9% for the full year.
Stability continued for the Cass Truckload Linehaul Index® in February, with a 0.1% m/m increase after falling by 0.6% m/m in January. The 5.4% y/y decline was the narrowest in the past year.
With spot rates steady over the past several months, downward pressure on the larger contract market is lessening, with some instances of contract rate increases bucking the downtrend recently.
See the Methodology for the Cass Truckload Linehaul Index
While the freight cycle is certainly stabilizing with rates below sustainable levels in many cases and little room for further savings, we’re also seeing surprisingly strong new equipment orders for this point in the cycle. In our view, planning for upcoming emissions regulations is likely a key factor. These capacity additions suggest the long bottom in the freight cycle may lengthen even further.
Our outlook through 2026 is detailed in the ACT Research Freight Forecast. This service provides in-depth analysis and forecasts for a broad range of U.S. freight measures, including the Cass Freight Index, Cass Truckload Linehaul Index, and DAT spot and contract rates by trailer type, LTL, and intermodal price indexes. We provide monthly, quarterly, and annual predictions for over 40 data series over a two- to three-year time horizon, including capacity, volumes, and rates. The ACT Research Freight Forecast is released monthly in conjunction with the Cass Transportation Index report.
How have ACT Research’s freight forecasts performed? For 2023, ACT’s forecasts for the shipments component of the Cass Freight Index were 96.9% accurate on average for the 24-month forecast period.
(As a reminder, ACT Research’s Tim Denoyer writes this report.)
ACT Research’s 2023 forecasts for the Cass Truckload Linehaul Index were 96.6% accurate on average over the past 24 months, and 98.5% accurate over the past 12 months. The Cass Truckload Linehaul Index averaged 143.8 in 2023, precisely in line with our July 2023 estimate.
Release date: We strive to release our indexes on the 13th of each month. When this falls on a Friday or weekend, our goal is to publish on the next business day.
