The Stifel Nicolaus Logistics Confidence Index, a monthly survey of international shippers and forwarders in the Europe-based air and ocean freight trade lanes, climbed 2.5 points in November to a record high 57.1.
The index, developed by Stifel Nicolaus Transportation & Logistics Research Group, has remained above 50 — the threshold signifying growth in cargo volumes vs. deceleration — since February. November’s reading was 20.4 percent higher than last year’s 47.4 reading and 4.4 percent higher than last month’s 54.6. The report pointed toward improving economic conditions in Europe as the probable cause for the “strong” increase in the overall index, although it noted that overcapacity and low growth levels continued to be “challenging” for forwarders.
Despite “significant volatility in underlying ocean rates,” the overall sea freight index climbed 3.3 points from October to 57.9 in November. The index registered strong increases in most lanes, except the U.S.-Europe trade, which increased only 0.2 points to 54.3.
The report showed that sea forwarders were mixed on all lanes covered for the next six months, although the index declined 0.1 points to 62.0 in November. Notably, 42.3 percent of the survey respondents indicated they don't believe ocean freight rates have bottomed out.
The overall air freight index increased 1.6 points month-over-month to 56.3 in November, and was up 10.4 points from November 2012. It represented the first time since the index began in March 2012 that it has climbed into “expansion territory,” according to the report. Monthly air freight volume increased in all lanes except the U.S.-Europe route. In terms of expectations for the next six months, the index increased 0.4 points to 61.6 in November.
The report concluded that air and sea forwarders were facing continuing challenges in the U.S.-Europe trade because of the weak European economy and the partial shutdown of the U.S. government in October. Regarding the six month outlook, the overall index remained relatively flat, increasing only 0.1 point to 61.8.