And just like that, we’re back to the same song and dance. April’s freight numbers from Cass Information Systems landed this month, and surprise, surprise—shipments are steady-ish, while rates are doing their best impression of a rocket launch.
It’s enough to make you yawn, if you weren’t busy trying to figure out who’s actually getting rich off this. We’re talking a 4.4% year-over-year dip in shipments, but a little bump of 0.4% from March. Seasonally adjusted, that’s a 0.6% uptick. The report’s chirping about a “promising sign” for the latter half of the year. Right. More of the same, probably.
What’s really moving the needle, apparently, is capacity. Or rather, the lack thereof. Noncompliant drivers getting the boot—thanks, FMCSA regulations—means fewer trucks on the road. Simple supply and demand, folks. Except when the supply side is being artificially squeezed, it’s less about demand and more about who’s got the deepest pockets to absorb the hits.
Why Are Rates So High (Again)?
J.B. Hunt is out there saying shipper demand is actually ahead of expectations. They’re practically licking their chops, seeing a clear path to jack up truckload rates over the next couple of years. Meanwhile, the Cass report is pointing to improvements in less-than-truckload (LTL) tonnage for some players. It’s starting to feel like a domino effect, with tightness in dry van bleeding into reefer and flatbed, eventually pushing up LTL and intermodal too.
This whole dance is costing more, too. The expenditures index shot up 3.5% year-over-year, and 2.6% from March. Why? Higher diesel prices and, you guessed it, core freight rates. They’re not hiding it.
The Cass truckload linehaul index… surged 5.6% year over year—the largest such increase since August 2022.
That’s a jump. And it’s been happening for sixteen straight months. The report, bless its heart, admits the cycle is driven by supply side shenanigans, with those pesky fuel prices eating into consumer spending and interest rates strangling the housing market. They’re hoping demand will eventually “take over to sustain the recovery.” Hope is not a strategy, my friends.
It’s the same old story, just with new regulatory jargon. Capacity tightens, rates climb. The real question is when—or if—this cycle ever truly breaks in favor of shippers and consumers, or if it’s just a perpetual gravy train for a select few.
Is This the New Normal?
The Cass data, processed from $37 billion in freight payables annually, paints a clear picture. This isn’t just a blip; it’s a sustained trend. We’re seeing the supply chain equivalent of a choke point, and everyone’s feeling the pinch. The tech bros selling AI-powered logistics solutions probably love this. More chaos, more demand for their ‘solutions’. And who’s making money? The carriers who can weather the storm, the brokers who can play the arbitrage game, and the folks selling the shovels during the gold rush.
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Frequently Asked Questions
What is the Cass Freight Index? The Cass Freight Index is a data set compiled from freight bills processed by Cass Information Systems, tracking shipment volumes and expenditures for businesses.
Will freight rates continue to rise? Given the current capacity constraints and regulatory pressures, a continued rise in freight rates is likely, though the sustainability depends on eventual demand recovery.
How do new FMCSA regulations impact freight costs? New FMCSA regulations appear to be a catalyst for tighter capacity by forcing some drivers out of service, which in turn drives up freight rates.
