set to slow down
01/12/2009 - IFW
The European freight forwarding sector’s recovery looks set to slow over the coming months, according to Danske Bank’s latest European Freight Forwarding Index.
The 160 forwarders that responded said the freight market is expected to be slow at the beginning of 2010, which is a more negative outlook than they gave last month.
However, they did not expect the market to be as slow as in 2009.
Respondents to the Danske Bank survey were asked two questions: what volumes their company handles today compared with two months previously; and how they expect volumes to develop over the following two months. Respondents were given three options to reply: lower volumes, unchanged volumes, and higher volumes.
The answers were then translated into an index ranging from 0 to 100, in which a value above 50 represents an improvement in business levels.
The forward-looking section of the index fell from 69 last month to 54 this month.
However, Danske Bank points out that the index is still above 50, indicating continued expansion.
Johannes Moller, Danske Bank transport equity analyst, said: “The figures could be somewhat distorted by seasonal effects (even though we ask participants to adjust for seasonality), but even taking this into account, we believe freight forwarders are turning more negative.
“Our discussion with the participants gives no clear picture about, whether the slowdown in the index is caused by normal seasonality or an underlying weakness in the market.
“Some freight forwarders are really negative while others see the beginning of 2010 more as the summer of 2009, when volumes were below trend for a couple of months, but the underlying recovery was still in place.”
In terms of sector, road freight was the least optimistic, with its index falling from 76 last month to 49 this month, while the sea freight index fell from 69 to 54 and the air freight index slid from 69 to 63.