Freight forwarding index increases as outlook improves

After a two month decline, the Stifel Logistics Confidence Index rebounded in June. Compiled by Transport Intelligence, the overall index, which combines the current situation with future expectations, increased 0.7 points from 50.7 in May to 51.4 in June. In addition, the index was 0.1 points higher compared with the same month in 2012. Furthermore, June marks the fifth consecutive month the overall index registered above the 50 threshold, indicating growth in the overall European freight forwarding market.

Optimism appears to be on the increase as signs of an economic improvement in Europe emerge. There are also signs of possible stabilisation within the airfreight market. While for sea freight, carriers’ attempts to raise rates are proving futile as overcapacity remains a concern.

In terms of sea freight, the index for the current logistics situation increased 1.2 points to 48.2 for the current month; compared to last year, the index was 2.5 points higher. Meanwhile, the overall index for air freight noted an increase to 42.0 in June, up 0.6 points from May; compared to last year, the air freight index is 0.9 points higher. Despite both air and sea indices remaining below the 50-level threshold, the improvements are probably due to seasonal rebounds in volumes as well as the launch of Samsung’s newest smart phone and other high tech gadgets. Whether these increases are sustainable is unknown due to the fragility of the current environment.

Still, despite the uncertainty of the market, forwarders remain positive regarding the six-month outlook. The index for logistics expectations increased 0.4 points to 57.6. This increase notes anticipation for improving volumes. 

In this month’s unique question, we asked survey participants if their companies have taken steps to improve their response to supply chain threats. Over three-quarter of respondents (75.4%) have taken measures to respond to supply chain threats, while almost 12.0% have not. The remaining 12.8% were unsure if any measures had been implemented.

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The Stifel Logistics Confidence Index is generated from an extensive survey of global logistics professionals, asked to provide their views on current levels of volumes in the industry and their expectations for six months’ time. An index value of 50 indicates no change in the volumes currently being experienced for the time of year; above 50
indicates higher volumes, while below 50 indicates lower volumes.