Omicron Hits January Volumes, Freight Rates Still High

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Freight shipments fell 7.4% seasonally adjusted from December to January, reports FreightWaves quoting a Monday report from Cass Information Systems.

The volumes component of the Cass Freight Index was also 2.9% lower year-over-year. The report called out a rise in omicron cases as the reason.

Drop in volumes

The drop in volumes “is about as good an answer as we have to the question of how big an impact Omicron-related absenteeism and quarantines had on the freight economy,” ACT Research’s Tim Denoyer commented in the report.

He doesn’t believe consumer demand is receding even though ships awaiting berths at Southern California ports have declined nearly 30% in recent weeks.

While these effects are lingering in February, they are beginning to fade and we expect a rebound in the coming months as case counts fall sharply,” Denoyer continued. “This was not a demand-driven decline, as inventories are still lean and consumer balance sheets strong.”

He pointed to growing cues at East Coast ports as supportive of demand.

Shipments in the month were still 5.5% higher compared to January 2020.

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Source: FreightWaves

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