Truckload rate growth hits double digits

U.S. truckload rates surged 10.2 percent in July, the largest year-over-year percentage increase in more than a decade.    Growth in domestic U.S. truckload rates accelerated yet again in July, with pricing jumping another 10.2 percent compared with the same month a year ago, according to the latest Cass Truckload Linehaul Index.
   Following then-record-setting increases of 8.2 percent in April, 9 percent in May and 9.5 percent in June, the July index growth to a reading of 138.1 represents the 16th- consecutive month of year-over-year gains and the first double-digit percentage increase since the index began in 2005.
   The index had fallen for 13 straight months — from March 2016 through March 2017 — prior to the recent growth, but with capacity continuing to tighten as demand rises, carrier pricing power looks set to continue accelerating as the year goes on.
   Donald Broughton, an economist that analyzes the TL index and the North American freight transportation industry at large for Cass, said that as a result of the acceleration in rate growth, the firm in June increased its realized contract pricing forecast for 2018 from between 6 percent and 8 percent to between 6 percent and 12 percent and that “current data is clearly signaling that the risk to our estimate may be to the upside.”
   “We believe that this is the strongest normalized percentage level of truckload pricing achieved since deregulation (normalized meaning except for extreme periods of recovery from recession),” he said.