Truck tonnage is collapsing amid all the green shoots observed everywhere. Note the quote
"The absolute dollar value of inventories has fallen, but sales have decreased as much or more, which means that inventories are still too high for the current level of sales.
If in fact inventories have only fallen in line with sales, the inventory cycle that we all hope will reignite the economy is not imminent. This chart shows that inventories remain way too high.
From CalculatedRisk
Press Release: ATA Truck Tonnage Index Fell Another 2.2 Percent in April (ht dryfly)
The American Trucking Associations’ advance seasonally adjusted (SA) For-Hire Truck Tonnage Index fell 2.2 percent in April, after plunging 4.5 percent in March. April marked the second sequential decrease. In April, the SA tonnage index equaled just 99.2 (2000 = 100), which is its lowest level since November 2001. The not seasonally adjusted (NSA) index, which represents the change in tonnage actually hauled by the fleets before any seasonal adjustment, was down 2.9 percent from March. In April, the NSA index equaled 101.6.
Compared with April 2008, tonnage contracted 13.2 percent, which was the worst year-over-year decrease of the current cycle and the largest drop in thirteen years. In March 2009, tonnage dropped 12.2 percent from a year earlier.
ATA Chief Economist Bob Costello said truck tonnage is getting hit from both the recession and the massive inventory correction that the supply chain is currently undergoing. "While most key economic indictors are decreasing at a slower rate, the year-over-year contractions in truck tonnage accelerated because businesses are right-sizing their inventories, which means fewer truck shipments," Costello said. "The absolute dollar value of inventories has fallen, but sales have decreased as much or more, which means that inventories are still too high for the current level of sales. Until this correction is complete, freight will be tough for motor carriers." Costello added that truck freight has yet to hit bottom and it could be a few more months before this occurs.
Rail traffic is not any better (from Paul Kedrosky’s InfectiousGreed)
Inventories remain way too high:
Related posts:
- Report: Truck Tonnage Increased in February
- Truck Tonnage Index: Cliff Diving
- US GDP: INVENTORY REBUILDING CYCLE COMING?
- HOUSING WATCH: FLORIDA: Price Declines Continue; Distressed Inventory Looms
- US CPI Declines in April. Inflation/Deflation Chart Since 1872
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