Freight Market Tightens Further: March Cass Data Shows Rate Gains, Volume Recovery

Key Details Cass Information Systems reported March freight shipments improved significantly, with multimodal shipments up 3% sequentially and down just 4.5% year-over-year - the smallest annual decline since June. The data suggests the freight market is stabilizing after extended weakness in industrial sectors that drove LTL demand. Rate Environment Freight rates climbed substantially despite softer volumes. The Cass expenditures index jumped 4.9% from February, indicating actual freight rates were roughly 9% higher in March when volume declines are factored in. The TL linehaul index increased 1.8% year-over-year, marking 15 consecutive monthly gains despite a modest 0.5% sequential dip. Why It Matters Driver availability constraints are becoming a critical capacity factor following new non-domicile CDL rules implemented in March. Higher diesel prices continue limiting capacity as some carriers operate at reduced levels. However, Cass expects volumes to turn positive in the back half of 2024, with April forecasted at minus-5% year-over-year. The Outlook Analysts note the Cass data is finally catching up with other leading indicators showing demand improvement. Tightness in dry van markets is spreading across other segments, and manufacturing PMI signals potential LTL demand growth ahead. Driver scarcity appears likely to sustain upward rate pressure moving forward.