Cass Truckload Linehaul Index Up Strongly

April’s Cass Truckload Linehaul Index continued the acceleration that began in 2017 by posting an 8.2% YoY increase to 134.8, the largest YoY percentage increase in this index to date (the base year is 2005).

After signaling an industrial recession in the U.S. and being negative for 13 months in a row (from March 2016 through March 2017), the Cass TL Linehaul Index has not only been positive now for thirteen months in a row, but the strength is continuing.

“Our realized contract pricing forecast for 2018 is 6% to 8%, and current data is clearly signaling that the risk to our estimate may be to the upside,” stated Donald Broughton, analyst and commentator for the Cass indexes. “We believe that this is the strongest normalized percentage level of TL pricing achieved since deregulation (normalized meaning except for extreme periods of recovery from recession). The current strength being reported in spot rates is leading us to believe contract pricing rates should keep rates in positive territory well throughout 2018.”

The latest data point shows total intermodal pricing (all-in intermodal costs) rose 6.6% YoY in April. The index is now at 141.9, just shy of the all-time high of 143.2 established in March. April marked the nineteenth consecutive month of increases, and brings the three-month moving average up to 5.9%.

“Tight truckload capacity and higher diesel prices are creating incremental demand and pricing power for domestic intermodal,” stated Donald Broughton, analyst and commentator for the Cass indexes. “Longer term, we continue to foresee oil trading in the $45 to $65 range and diesel in the $2.50 to $3.25 range throughout 2018 (without the refining interruption pressure produced by hurricanes or other catastrophic events).”

 

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