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John’s Blog
1-17-11
Dear Friends,
Consumer confidence slipped after a
positive six month run. It declined last week to a 72.7 reading
after hitting 74.5 in December. The index had been averaging 89 up
to the start of the recession at the end of 2007.
The Commerce Department reports that
retail sales increased in December by 0.6% after a November gain of
0.8%.
Also reported by the Commerce
Department was a decline in wholesale inventories which fell by 0.2%
in November. Wholesale inventories make up 1/4th of all
inventory while the remainder is held by manufacturers and retailers.
Manufacturing continued to do its part
in the recovery with the Institute for Supply Management’s index
increasing to a 57 reading in December after hitting 56.6 in
November. As manufacturing increases the more likely that hiring
will take place as this key indicator gains momentum.
The Labor Department reports that the
price of imported goods increased 1.1% in December led by food and
imported fuel. US export prices rose 0.7% after jumping 1.5% in
November.
Speaking of imported fuel, diesel
prices increased for the sixth straight week rising to a national
average of $3.333 per gallon according to the Department of Energy.
As a reminder the all time high price was $4.764 per gallon in July
2008. The DOE is now saying the new forecast for diesel fuel this
year is an average of $3.40 per gallon.
A lot has been said about trucking
capacity and the Bureau of Labor Statistics says the number of
trucking companies they track dropped 7.5% from 2007 through early
2010. Trucking employment fell 16.6% during this same period.
The DOT’s freight transportation
services index increased slightly in November by 0.1% year over year
to a 98.5 reading. The transportation services index uses 2000 as
its base year reading of 100.
In intermodal, the American Association
of Railroads said that traffic rose 8.6% in the week ending January
8th. Container traffic was up 10% to 182,209 units while
trailers increased 1% to 31,456 units. The AAR said that carloads
increased 20.1% year over year in the first week of the new year.
At Wagner we are beginning the year
working on several initiatives to improve operations and asset
utilization. We are adjusting our Key Performance Indicators and
seeking improvements across all measures.
If there are any opportunities to work
with you I would be happy to have that conversation should you need
help in distribution warehousing, fulfillment, packaging or
transportation.
Have a great week!
John Wagner Jr
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