Latest industry survey indicates improving air freight conditions


Increasing confidence in the outlook for the transport and logistics sector helped raise the overall Stifel Logistics Confidence Index 0.6 points to 53.0. This is the eighth consecutive month the index registered above the 50 threshold, indicating improving conditions in the overall European freight forwarding market.


Optimism related to the air freight market was evident in the latest Index. For the current situation, the index noted a 1.6 point jump from August to 45.3. While still below the 50-level, this is the highest point for the current air freight market since the Stifel Logistics Confidence Index began in early 2012. By tradelane, the Europe-US lane recorded an exceptionally strong increase at 4.9 points, while the US-Europe lane recorded a more marginal increase of 0.8 points. While both lanes still indicate contractions compared to expectations at 47.9 and 45.7, they too, are at the highest levels since the Index first began. The improving economies for the US and Europe are perhaps among the reasons for this growth.


The Logistics Confidence index continues to indicate increasing optimism among European freight forwarders in regards to the next six months for the air freight market. In particular, on the Asia-Europe lane which noted the largest gain from August, increasing 4.6 points from August to 60.4. This may indicate the potential increase in spending as the holiday season approaches.


The overall sea freight index noted a 0.4 decline to 54.1. The decline was noted in both the present situation which declined 0.4 points to 48.4 and six months expectations which declined 0.5 points to 59.7. The decline may be due to rate implementations and announcements for additional rate adjustments effective September 1. It was particularly interesting to note that the US tradelanes were negatively affected for both present and future expectations; meanwhile the Asian tradelanes were mixed.


Despite the downturn in the sea freight index, in this month’s unique question, we asked survey participants if they believe there will be a peak season in 2013. The mixed results indicated uncertainty among participants as 42.4% indicated there would be a peak season, while 36.7% indicated there wouldn’t and 20.9% were unsure. However, a general consensus among the survey participants was the feeling there would be no peak season for the European market as the region was still recovering. Other participants expect a peak season to occur in late October or early November.


The Logistics Confidence Index indicates there should be a positive change in the next six months, climbing 0.5 points to 59.1 for September. Confidence is on the rise as freight forwarders expect improving market conditions and increases in volumes.


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