April Cass Freight Index Report sees another month of shipments and expenditures declines

Freight shipment and expenditure readings again saw declines in April, according to the new recent edition of the Cass Freight Index, which was recently issued by Cass Information Systems.

Many freight transportation and logistics executives and analysts consider the Cass Freight Index to be the most accurate barometer of freight volumes and market conditions, with many analysts noting that the Cass Freight Index sometimes leads the American Trucking Associations (ATA) tonnage index at turning points, which lends to the value of the Cass Freight Index. What’s more, the Cass Transportation Indexes accurately measure changes in North American freight activity and costs based on $44 billion in paid freight expenses for the Cass customer base of hundreds of large shippers.  

April’s shipment reading—at 1.144—was down 2.4% annually and was off 1.0% compared to March, which was down 1.0% compared to February, and February was down 0.3% compared to January’s 1.124 reading. That was preceded by a 3.9% annual increase in December, a 0.4% November decrease and a 3.9% annual gain in December. It also trailed August’s 1.278 reading, which marked the highest level for shipments since May 2018. On a two-year stacked change basis, March shipments were down 2.9% and down 1.3% on a month-to-month seasonally adjusted (SA) basis.  

The report’s author, Tim Denoyer, ACT Research vice president and senior analyst, wrote that amid the ongoing soft backdrop, warm weather appears to have pulled some freight into January/February this year from March/April.

“But several higher frequency freight data series started April very soft and improved through the month and into May,” he wrote. “This augers toward at least a seasonal improvement in May, though the y/y decline may still worsen on a tough comp against inventory building a year ago. Declining real retail sales trends and ongoing destocking remain the primary headwinds to freight volumes, but dynamics are shifting as real incomes are improving, and the worst of the destock is most likely in the rearview. Normal seasonality from the April index level suggests 1%-3% y/y declines for the next few months.”

The April expenditures reading—at 3.877—fell 14.0% annually and was down 1.0% compared to March. Expenditures were up 12.3% on a two-year stacked basis and down 4.0% on a month-to-month seasonally adjusted (SA) basis.  

Denoyer noted that the expenditures component of the Cass Freight Index rose 23% in 2022, after a record 38% increase in 2021, but is set to decline about 12% in 2023, assuming normal seasonal patterns from here.

“After a long soft patch in the U.S. freight cycle, we see the industry on the cusp of a new cycle in the months to come,” he added.