Tank loadings dip in March
May 3, 2012
Tank loadings will benefit in 2012 from the service sector recovery and the stabilization of oil prices. The addition of modest fuel growth to strong industrial chemicals and a good year in fertilizers should produce growth above the 2% historical average. Loadings were virtually unchanged in March at 9.293 million, down just 0.1%. Year-over-year growth was also negative, down 1.2%.
Tank freight fell hard in the middle of 2008 but had a surprisingly strong uptick to end the year. Volumes then proceeded to drop for the next four quarters, bottoming out at the end of 2009. Growth was solid and steady throughout 2010 but revised data for 2011 shows that the market weakened considerably during the year, with a big drop in Q3. Luckily, it looks like we were better able to hold onto the volume increases that occurred in December. This means that our volume levels in 2012 are relatively unchanged versus last month.
Tank loadings fell 9.0% in 2008 and 5.8% in 2009. Volumes were nearly unchanged in 2010, up just 0.7%. 2011 wasn’t much better with loadings growing just 1.7%. Growth will remain relatively weak for this recovery, rising 1.4% in 2012 (up from 0.5% last month). The year-over-year comparisons are looking better in 2012, but the actual volume levels are a little bit lower this month. Growth will then settle into the 2%+ range, rising 2.0% in 2013 and 2.1% in 2014.
Note that very soft natural gas prices and limited storage for additional production could substantially reduce the large demand for tank capacity in the well drilling markets. The collapse, even temporary, of that boom could flood the tank market with excess capacity.
The 2011 economic slowdown should reverse in 2012 for industry commodities, although the pressure on fuel prices will weaken gasoline volumes. There is additional fracking volume in this segment that is not getting into the traditional market data, including ours. That puts additional upside to our modest forecast.
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.
Click the link below to print a print-friendly page of the this analysis.Print Page
Use our chart creator to generate charts using the data that was used in this analysis.TruckGauge Chart Creator
This functionality is only available to Premium Members. Please upgrade your account to gain access to the data used in this analysis.Upgrade to a Premium Member