The trend in North American freight volumes “continues to follow the path of general malaise” that the economy is experiencing, says the latest Cass Freight Index Report. The number of freight shipments in June was up “a scant” 1.3 percent from the previous month, while at the same time total freight costs declined 0.1 percent.

“The economy has been flat for several months and is even beginning to trend downward in terms of new orders and manufacturing output. This slowdown on manufactured goods is putting downward pressure on freight,” said Delcan Corp.’s Rosalyn Wilson, who provides supply chain analysis for Cass.

Calendar year-to-date figures show growth for the first half of the year: 9.9 percent on shipment volume and 7.7 percent on total freight expenditures. But compared to the same period a year ago, 2012 growth is significantly slower, as shipment volumes in 2011 were up 15.5 percent from 2010, the report noted.

The trend in freight shipments continues upward for the year, although volume compared to June of last year was down 1.3 percent. For the second quarter, the number of freight movements is only 0.3 percent higher than in the second quarter of 2011, and down from a first quarter increase of 1.8 percent.

Truck shipments are mostly flat, despite strong growth in movements of seasonal produce and oil shale fracking products.

“The tight supply appears to be due more to a contraction in fleet and driver size than to an increase in demand,” the report said. “The trucking industry is barely balancing demand and supply in this weak freight market, so it might take just a small increase in demand for more wide-spread capacity problems to arise.”

Freight expenditures were “an almost imperceptible” 0.1 percent lower in June, the first decline since February of this year, according to the Cass report. The second quarter increase of 3.8 percent over second quarter 2011 compares to a first quarter rise of 11.5 percent in 2012 over the same period in 2011.

“Rate hikes pushed total freight costs up more than 30 percent in the first half of 2011, and despite the lack of volume growth, the rate hikes have held,” Wilson said. “The average revenue per shipment for trucks has been falling since April, despite announced rate hikes by many carriers. The tenuous capacity equilibrium has not yet started to exert upward pressure on rates.”

Most rate increases to date have been to cover rising expenses, not to increase profits. Rail rates have continued to escalate, especially for intermodal moves, but even those hikes have slowed in recent months, the report added.

“With the peak shipping season fast approaching, forecasts do not indicate that it will be robust,” Wilson suggested. “Container volumes through the ports are expected to rise only 2 to 5 percent. Chassis are in abundant supply, the railroad is set to handle any increase, and the trucking industry will be able to handle this magnitude of increase, if it materializes.

“This year’s peak shipping season could turn out to be the non-event it was last year.”

The Cass Freight Index represents monthly levels of shipment activity, in terms of volume of shipments and expenditures for freight shipments. The Cass Freight Index is based upon the shipments of hundreds of Cass clients representing a broad spectrum of industries. The index uses January 1990 as its base month.