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Regular Industry Development Updates, Opinions and Talking Points relating to Manufacturing, the Supply Chain and Logistics.

Capacity and price indices remain at extreme levels

21-Nov-2017
Oliver Kahrs (pictured)
Director Strategic Initiatives, Transporeon
Capacity and price indices remain  at extreme levels
The thirty-third edition of the Transport Market Monitor (TMM) by Transporeon and Capgemini Consulting reveals that transport capacity and price indices remain at extreme levels.

Main highlights of the report:
  • The capacity index increased by 2.6% to an index level of 67.4 in Q3 2017. Compared to Q3 2016, the capacity index is 20.5% lower. 
  • The price index increased by 0.6% in Q3 2017 (index 101.8). When comparing to the index level of the previous year, Q3 2016, we see that the price index increased by 7.0%. 
  • The diesel index declined to an index of 75.3. This index is 3.0% lower than Q2 2017. 
  • The European Trade Flow Index is expected to drop by 5.7% in Q3 2017. 

Erik van Dort, Supply Chain Director at Capgemini Consulting, notes: “As usual we saw an after-summer dip in capacity in September. But this year, the September decline was particularly sharp, leading to the highest prices of the year. Typically we would expect that this will normalize from October onwards, but it will be interesting to see whether this materializes in the current market”

Oliver Kahrs, Director Strategic Initiatives at Transporeon, added: “In September, we recorded the lowest capacity index since January 2008. This means that transport prices are also very high. Although capacities grew slightly overall in the 3rd quarter, they dropped suddenly in September. It is difficult to predict whether the situation will see further recovery in the 4th quarter. The level remains fundamentally too low. Capacity constraints are the dominant topic in the sector, for which reason the current diesel prices are also not reflected in the transport prices. It can moreover be anticipated that the price of crude oil will soon increase again as a result of global political developments.”

More details can be found in the Transport Market Monitor on http://www.transportmarketmonitor.com.