The slump in commodity prices over the last few months, combined with an economy in China which is leaning towards recession have combined to decrease shipments of manufactured items and raw materials around the globe. World trade volumes increased by only 1.5 percent from September to November compared with the same window in 2015. It's clear that volume growth has been significantly weaker during the current economic expansion than during previous cycles, but it has slowed even more since early 2015.
Consumption of diesel fuel in the United States has leveled off this year, after two consecutive years of strong demand. Experts say that this slowdown in usage mirrors the slowdown we've seen in inland freight movement, and the larger slowdown in shipping worldwide, compared to 2013 and 2014. Reasons for the slowdown include the strong US dollar and the a slowdown in economies like China and Brazil. The number of empty shipping containers which are returning to Asia has been increasing steadily in the last few months.
Australia’s domestic freight task is expected to triple from its current size by 2050. There is a concerted industry push to increase rail’s share of the growing freight transport task through productivity and customer focused initiatives. As a result, major additions to the inland transportation hub are being planned to accommodate the uptick in rail volumes.
Due to fewer loads available and increasing truck capacity, rates on the spot freight market continued falling the past week.
From Jan. 18 through Jan. 24 flatbeds posted the biggest decline, compared to the previous week. This decline caused them to shed 1.8%, for an average of $2.21 per mile. A decline in the line haul portion of the rate caused about three quarters of this drop, while the rest was due to a lower fuel surcharge. This is compared to a rate of $2.31 per mile for the seven-day period ending Jan. 3.
