The Federal Reserve reports a recent drop in demand for trucking services, while ports and the overall economy showed modest progress.
The nation’s economy continued moderate growth from mid-May to June 30, according to the Fed’s July 13 Beige Book. Eight times a year, the bank publishes this summary of anecdotal information from business contacts and market experts in its 12 service districts.
Freight volume dropped in Cleveland’s district, while Chicago’s district reported less demand for transportation services. Rail cargo volume decreased in Atlanta’s and Dallas’ districts. Cleveland’s, Atlanta’s and St. Louis’ districts attributed lower cargo volumes to the slowdown in the energy sector.
Richmond district’s port activity remained mostly strong. Container volume rose overall, albeit, increasing year-over-year monthly at one port, while similarly declining at another. Automobile imports remained robust and a strong peak season for container imports of consumer goods is anticipated for August. Imports and exports of agricultural and construction machinery stayed soft.
Atlanta district’s transportation companies had mixed results in recent weeks. Port contacts said volumes of container traffic, bulk cargo, automotive goods and machinery volumes climbed. Still, air cargo was down slightly, compared with year earlier levels, while overall railroad traffic has continued to slow.
Cleveland district’s freight volume shrunk, both recently and on a year-over-year basis. Regional sources attributed the decrease to a slowdown in the industrial sector and rapid changes in retail distribution. They also told the agency system overcapacity had forced some haulers to lower shipping rates and reduce capital budgets. Energy, fabricated metal products, machinery and food products were reportedly weak.
Still, the district reported strong freight volume for automotive, building materials and furnishings.
St. Louis’ district gave transportation a mixed review. One trucking industry source planned a major expansion, but another trucking contact connected to the energy sector said business had declined.
Dallas reported chemical plant expansion on the Gulf Coast helped truck cargo volumes, while courier, air and rail cargo volumes decreased.
Heavy truck sales declined in Richmond, Chicago and Dallas districts. One Dallas dealer noted that higher prices because of next model year’s engine emissions requirements could weaken future sales.
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