Refrigerated loadings rise in January

Refrigerated volumes have moved noticeably higher since a big drop in July. Loadings jumped another 0.4% in January to 4.231 million. December’s big gain was revised down slightly to 1.0%. January’s gain was right on our expectations. The year-over-year comparisons are currently weaker than originally estimated as volumes in late 2010 and early 2011 were revised higher. January showed no gain from the same month in 2011.

NOTE: We are continuously updating and improving our data and calculations so that we can present you the best insights and analysis available. To that end we have updated our historical data to better reflect the wide swings in economic activity that occurred during the Great Recession and the ensuing recovery. You will notice substantial changes to our data this month. To find out what those changes were and how they affect our outlook for the industry click here.

Recent history
Freight volumes were flat in 2009 after growing 4.3% in 2008 – one of the only sectors to show growth in 2008. Loadings were also flat for full year 2010, up just 0.1%. Refrigerated freight fell during every quarter of 2009 and then rose during every quarter of 2010 – leading to the 2 consecutive years of no growth despite substantial quarterly movements. Growth was also low in 2011, up just 1.9%. This is very typical of this market segment. 2011 actually saw volumes decline quarter-over-quarter until Q4, but the weak start to 2010 allowed year-over-year growth to be strong.

Outlook unchanged
The revised data shows a market that is not generally susceptible to wide swings in activity. This lines up with our notions for the market and confirms that our outlook for just over 2% growth going forward is reasonable. The outlook for 2012 moved slightly lower, but this is only on the basis of the improvements seen in the 2011 data. At 2.2% this is reasonable growth for this market but is below the average for the truck industry. Growth will then accelerate slightly to 2.4% in 2013 and 2.8% in 2014.

REVISED DATA: 2009 changed from a decline of 5.1% to no growth. 2010 changed from a big gain of 8.7% to just 0.1%. 2011 growth moved higher from -0.3% to +1.9%.

A stable market
This is a more non-cyclical market segment and generally stays within a narrow band of +/- 5%. People always have to eat. We are now at the negative portion of the refrigerated cycle where its very low cyclical pattern keeps growth below industry averages. The same modest numbers look very good during a downturn when the other segments fall sharply.

As usual, the classically stable reefer market trails dry van growth. We continue to forecast the typical, slow upturn growth for this segment. Note, however, that a slew of new Federal food regulations expected sometime in 2012 could increase the requirements for temperature-controlled trucking.

NOTE:
U.S. Truck Loadings is the estimated number of truck loads originated in the United States plus truck loads that come to U.S. destinations from Mexico and Canada. It is tons divided by the average tons per truck. FTR’s data is seasonally adjusted and measures both short and long-haul OTR segments.