Truckload linehaul rates jumped 2.9 percent in January, the biggest year-over-year increase since last February, Cass Information Systems said Thursday. The increase in the Cass Truckload Linehaul Rate Index reflects higher spot market rates, growing freight demand and declining capacity, Cass said.
Intermodal rates rose 1.7 percent from a year ago in January, as the Cass Intermodal Price Index increased for the first time year-over-year since August. “Truckload costs are increasing. Inevitably, then, intermodal costs will also rise,” Cass said. Intermodal rates were up 2.2 percent from December.
The rate hikes also reflect supply chain disruption caused by severe winter storms in January that continue to snarl ground and air transportation networks in early February. Sporadic equipment shortages hit regions of the country pummeled by storms, driving up transportation costs.
Spot market truckload rates rose 13 percent year-over-year in January, according to DAT Trendlines, a composite of data drawn from DAT load boards. In the first week of February, dry van loads were up 15.6 percent while the national average van spot rate rose 2.1 percent to $1.97 per mile.
The Cass index reflects changes in contract and spot market truckload rates from freight invoices processed by Cass, which processed $23 billion in freight charges in 2013. The index hasn’t risen more than 2 percent year-over-year since last April. Intermodal rates were up 1.7 percent in January.
Donald Broughton, trucking analyst and chief market strategist at Avondale Partners, said the January rate hike in part was due to increased carrier bankruptcies. There were 335 trucking bankruptcies in the fourth quarter of 2013, compared with 150 bankruptcies in the fourth quarter of the previous year.
“Persistent cost pressures, relatively tepid demand, soft pricing, increasing regulatory pressure, and a less robust used truck market have taken their toll on smaller carriers over the last two years,” Broughton said in a statement. Small carrier bankruptcies increased despite rising freight demand.