A monthly index of truckload line-haul prices in October increased 5.5 percent from the year-earlier period, hitting the highest level since the index was formed in 2005, according to data published late yesterday.
The index, published by audit and payment firm Cass Information Systems Inc. and investment firm Broughton Capital Inc., measures pricing on a per-mile basis, and excludes the impact of fuel surcharges. Last month's reading surged close to 133, continuing a three-month tear for the index.
In response, Broughton Capital, run by long-time transport analyst Donald Broughton, has revised its pricing forecast three times in the past four months. In mid-summer, Broughton forecast 2017 rates in a range of -1 and 2 percent. In yesterday's announcement, Broughton updated his projections to show rates rising between a range of 2 percent and 4 percent.
Truckload rates have been moving up all year, paced by strong gains in the noncontract, or spot, market. Pricing has moved higher due to a combination of stronger freight demand, a continued shortage of qualified drivers, and concerns that federal regulations mandating that virtually all trucks be equipped with Electronic Logging Devices (ELD) by Dec. 18 will reduce miles travelled and driver productivity levels.
Separately, the trade group American Trucking Associations (ATA) said today that its seasonally adjusted for-hire tonnage index rose 3.3 percent in October, following a 1.9 percent decline in September. In a statement, ATA Chief Economist Bob Costello chalked up the October tonnage advance to a "much stronger freight market."
Cass and Broughton, which also publish a monthly tab of intermodal prices, said per-mile prices, which include fuel surcharges, rose 1.9 percent year-over-year in October. Prices last month rose sequentially by 2.9 percent, according to the data. October marked the 13th consecutive month of year-over-year increases for the index.
The index hit its most recent peak in March when diesel fuel prices approached $2.60 a gallon. It trended lower through the summer as diesel prices dipped. However, with weekly diesel prices above $2.90 a gallon, upcoming indexes are likely to show good-sized increases.