The Intermodal Association of North America (IANA) recently released its first quarter Intermodal Market Trends & Statistics. IANA will address the outlook for North American intermodal and its impact on the nation’s shippers at the IANA Intermodal EXPO 2014, to be held September 21 -23 in Long Beach, California. Registration is complimentary for qualified shippers and beneficial cargo owners.
Against the backdrop of IANA’s first quarter Intermodal Market Trends and Statistics, analysts are projecting the continued rise of North American intermodal freight volumes.
The story for years has been the dramatic rise in domestic container volume. This market segment has climbed at an impressive rate, with an 8-year cumulative increase, between 2005 and 2013, of 8.6%, and this is inclusive of the 2009 economic downturn.
The overall trend has continued during the first quarter of this year with total domestic intermodal shipments growing 4.1%, year over year. The surprise, however, is that unlike previous periods, these gains were driven by the use of intermodal trailers vs. containers. Attribution for the 7.5% increase in trailer movements ranges from regional highway congestion and closings to customers turning to trailers due to a lack of other equipment
“Severe weather during the first quarter impacted the entire transportation network,” said Joni Casey, President and CEO of IANA. “But despite these challenges, intermodal volumes showed modest growth, led by gains in trailer movements particularly in some of the regions that were hardest hit by winter.”
International shipments continued their volatility, with noticeable variations in volumes over the first three months of this year. Overall gains were 1.1% year over year. And if this trend holds, domestic intermodal loads will equal international volumes within the next few months, which will be a first in terms of intermodal traffic mix.
“The action is going to be in the domestic side,” according to Larry Gross, a senior consultant to FTR and a contributor to IANA’s Intermodal Market Trends. He predicts domestic intermodal volume increasing 6.9 percent in 2014, compared with 2013, and growing another 4.6 percent in 2015. At the same time, international loadings are estimated to rise at about the pace of overall trade growth, gaining 1.7 percent in 2014 and inching up an additional 1.5 percent in 2015. That equates to total year-over-year intermodal volume increases of 4.3 percent for 2014, and 3.1 percent for 2015.
Gross, who will participate in the Sept. 23 Intermodal EXPO educational session titled, “Intermodal Freightcast: Supply, Demand and the Prospect for Higher Rates,” also sees intermodal pricing moderately rising on a year-over-year basis, with door-to-door rates increasing in the low to mid-single-digit range by late 2014.
This observation is corroborated by IANA’s participating intermodal marketing companies (IMCs), who reported a 7.4% increase in average revenue per intermodal load for the first quarter of the year. This same group of 3PLs also saw average revenues for highway movements jump by 15.2%.
Another shipping pattern of note and a part of IANA’s analysis is the continuing trend toward shorter intermodal lengths of haul for both the domestic and international segments. Shippers are seeing expanded service offerings from the railroads that yield economies of scale in many lanes that are less than 1,000 miles, the past break-even benchmark.
Shippers and beneficial cargo owners are encouraged to attend this year’s Intermodal EXPO, where more emerging trends and analysis will be provided by transportation industry experts. Specific sessions of shipper interest include:
- “Big Alliances, Big Ships, Big Challenges,
- “Port Labor Agreements, The Key Drivers and Impacts to Terminal Productivity,”
- “The End of the Line for IPI? Trade, Transloading and the Prospects for IPI Growth,”
- “Shortening the Playing Field – Making the Case for Success in Short-haul Intermodal Corridors,”
- “How Much Does a Chassis Cost The Math of Chassis Economics,” and
- “Where’s My Driver? The Driver Shortage and What It Will Mean for Intermodal.”
Visit IntermodalEXPO.com for complete information, including complimentary shipper/BCO registration and housing links.