Dry van loadings up 0.3% in May
July 5, 2012
Once more, there are no major changes in our dry van outlook this month. We continue to expect dry van demand to track with the industry as a whole, unless the service sector achieves normal recovery growth rates. Should that happen, this consumer-heavy segment will perform above the overall market. Dry Van loadings were up 0.3% from April to May, hitting 21.464 million loadings. Loadings continue to improve on a year-over-year basis – they had been flat or negative for six months but were up 1.7% in April and a further 2.0% in May. Volumes have been trending higher since a surge of activity in December.
Dry Van freight fell in 2007 and then started dropping hard in late 2008. It bottomed out in Q3 of 2009 and then rose for six consecutive quarters before easing in the middle of 2011. Loadings fell 10.9% during 2009. Volume rebounded strongly in 2010, showing a gain of 5.0%. Loadings rose a more modest 2.7% in 2011 (revised up from 2.3% last month). Loadings were flat or modestly negative for most of 2011 but have been moving higher since December. On a quarter-over-quarter basis, loadings have improved the last 2 quarters, rising 0.5% in Q4 and 1.4% in Q1.
We expect loadings to show improvement for the remainder of 2012, leading to a stronger 2013. The year-over-year comparison finally moved into solidly positive territory in April. That trend should continue with growth around 4% in the second half of the year. Growth will continue in 2012, rising 2.4%, with modest acceleration in 2013 of 3.1% and in 2014, up 3.7%.
The real story of the current environment is the relative stability of demand. This is easily illustrated by results in the dry van and reefer markets; where van volumes have tracked with the industry as a whole, and reefer volumes have cycled less. This performance is completely normal for these two sectors. We expect it to continue. Weakness in some food segments and the consumer retail markets are keeping growth just below the industry average. Strength in auto production and a modest recovery in housing will benefit sub-segments for auto parts and appliances.
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.
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