Barge capacity and rail capacity are set to expand the most according to a recent note from Morgan Stanley.
The bank focused on the current freight transportation cycle among other things. In the report, analyst William Greene points out that “When freight volumes reached prior peaks, there were usually 1-2 years of additional growth before volumes started to low/decline, a lead indicator of recessions”, meaning roughly a year to two years after a peak in US Freight Cycles we'd see a contraction.
Freight Cycles Source: Morgan Stanley (Click To Enlarge)
The capacity at which the various modes of transportation operate at are expected to remain tight with Barge and Rail expanding the most.
According to data from Bloomberg, truck-driver's are at shortage levels, truck loads have increased and the price-to-shipping (excluding fuel) has remained elevated since the 2009 dip. Baltic Dry Index is reversing and hardly anyone is chirping.
To make matters worse for trucking is the heavily utilized active truck population used to move freight. If truck shipment increase, truckers will need to put ...
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