|March 2023||Year-over-year change||2-year stacked change||Month-to-month change||Month-to-month change (SA*)|
|Cass Freight Index - Shipments||1.155||-4.0%||-3.4%||-1.0%||-3.8%|
|Cass Freight Index - Expenditures||3.961||-12.0%||17.2%||-1.5%||-2.8%|
|Cass Inferred Freight Rates||3.429||-8.3%||NA||-0.5%||1.1%|
|Truckload Linehaul Index||147.7||-9.6%||3.2%||-0.6%||--|
* SA = seasonally adjusted
Tip: Be sure to scroll down to see our new TL/LTL mode mix trends chart. Credit to Tim Denoyer.
The shipments component of the Cass Freight Index fell 1.0% m/m in March as freight markets continue to work through an extended soft patch.
Soft real retail sales trends and ongoing destocking remain the primary headwinds to freight volumes, and sharp import declines suggest this type of environment will persist for some time. Normal seasonality from the March level suggests 1%-3% y/y declines for the next few months.
The expenditures component of the Cass Freight Index, which measures the total amount spent on freight, fell 1.5% m/m in March, and fell 12.0% y/y after a 9.7% y/y decline in February.
With shipments down 1.0% m/m in March, we infer rates were down 0.4% m/m (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®.
The expenditures component of the Cass Freight Index rose 23% in 2022, after a record 38% increase in 2021, but is set to retrench in 2023.
The rates embedded in the two components of the Cass Freight Index declined 8.3% y/y in March, after falling 9.4% in February.
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 Cass Truckload Linehaul Index fell 0.6% m/m in March to 147.7, after a 0.4% m/m decline in February.
Over the past year, the primary modal trend as capacity growth accelerated has been a considerable increase in the proportion of TL freight, and consequent declines in LTL and intermodal volumes.
TL and LTL are the two largest modes in the Cass database. The chart below illustrates the changes in mix between the two modes in y/y terms, ignoring the others for simplicity. Currently, TL represents considerably more of the data set than a year ago, and LTL is similarly below its year-ago level. Interestingly, and as we’d expect, in tight markets, freight flows from TL to LTL, and from LTL to TL in loose markets.
Critically, though it’s probably too early to call it a trend (the chart shows 3-month moving averages), the trend change so far this year suggests the trucking industry has passed peak looseness. Freight has been migrating to TL from other modes, but capacity growth has started to slow, and a rebalancing has begun.
For more on the future direction of freight markets, the ACT Research Freight Forecast provides 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. The service provides monthly, quarterly, and annual predictions for the TL, LTL, and intermodal markets over a two- to three-year time horizon, including capacity, volumes, and rates. The Freight Forecast is released monthly in conjunction with this report.
How have their forecasts performed? For 2022, ACT’s forecasts for the shipments component of the Cass Freight Index were 97.5% accurate on average for the 24-month forecast period. The January 2021 forecast, two full years out, was 99.8% accurate.
(As a reminder, ACT Research’s Tim Denoyer writes this report for Cass.)
ACT's full-year 2022 DAT spot rate forecasts were 99.7% accurate from Q2’21 (19-21 months out) for dry van and 98.5% for reefer. DAT dry van spot rates, net fuel, finished 2022 at $2.06 per mile, in line with our forecasts to the penny from 18 and 19 months out (June and July 2021).
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.
The material contained herein is intended as general industry commentary. The Cass Freight Index, Cass Truckload Linehaul Index (“Indexes”), and other content are based upon information that we consider reliable, but Cass does not guarantee the accuracy, timeliness, reliability, continued availability or completeness of any information or underlying assumptions, and Cass shall have no liability for any errors, omissions or interruptions. Any data on past performance contained in the Indexes is no guarantee as to future performance. The Indexes and other content are not intended to predict actual results, and no assurances are given with respect thereto. Cass makes no warranty, express or implied. Opinions expressed herein as to the Indexes are those of ACT Research Co., LLC and may differ from those of Cass Information Systems Inc. All opinions and estimates are given as of the date hereof and are subject to change.