Supply Chain and Logistics Enjoy Best Year Since Great Recession

According to the 26th annual “State of Logistics Report”, which was released by the Council of Supply Chain Management Professionals and presented by Penske logistics, the supply chain industry had its best year since the Great Recession in 2014. The driving force behind the success was a 3.6% growth in the transportation sector, as consumer spending increased shipment volumes and freight levels.

In terms of specifics, the railroad sector crept towards pre-recession levels with a growth of 6.5% in costs and a 4.5% increase in traffic volume. In addition, total carloads were up by 3.9%, which was the highest mark since 2006. Elevated shipments of grain and coal were largely responsible for the spike. Intermodal volume increased as well, jumping by 5.2%, which was above the record total of 2013.

The water sector had an even greater improvement, rising by 8.9%. The report states that “successful agricultural harvest, higher demand for coal and an expansion of petroleum transportation by barge” were the primary reasons for the boost.

Freight forwarder and Inventory-carrying costs both rose as well, with increases of 5.4% and 2.1%, respectively.

The only area in which there was a decline was the air cargo sector. Costs in the sector dropped by 1.2 percent, although there was a record $968 billion of high value merchandise transported via air, according to the report.

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Terry Mulreany
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