[190911.EN.LOG] European Road Freight Rates Achieve Highest Level In Three Years

EUROPEAN road transport prices to the highest level since 2008, according to the latest edition of Transport Market Monitor, published by Europe's Transporeon, of the Netherlands and Paris-based Capgemini Consulting.

Overall, the price index rose 7.8 per cent to 103.9 in the second quarter of the year, compared with the previous quarter and up three per cent when compared with the same period in 2010, said the consultants report.

UK's Transport Intelligence said rising diesel prices were one influencing factor driving the increase in European road transport rates.

Diesel prices and the overall price index continued to show positive correlation, although the increase in the transport price index was greater than the increase in the diesel index, which rose 5.8 per cent in the second quarter.

Capacity tightness, which declined 34.4 per cent, was clearly a strong driver in the overall price increase.

In April and June, when the capacity index declined, overall prices increased. While in May, the capacity index increased and overall prices fell.

The second quarter tends to see strong increases in road freight prices due to increased demand caused by seasonal variations, including Easter weekend, the report said.

Ramon Veldhuijzen, global head of logistics at Capgemini Consulting, said: "We saw the typical seasonal price and capacity development in the second quarter of 2011. Despite the normal seasonal upward effect, uncertainty in economic developments in Europe and the US could slow down the price increase during the subsequent quarters in 2011."

The publishers of Transport Market Monitor highlight the possibility that current economic concerns could lead to changes in the usual seasonal pattern of the price index.

In the third and fourth quarters of 2009 and 2010 the price index measured slight increases. However, in the fourth quarter of 2008, the beginning of the economic crisis, a decrease in the price index and an increase in the capacity index were monitored.

Source : HKSG.