European transport rates reach three year low

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The fifteenth edition of the European transport prices fell by 8.1 per cent in the first quarter of  2013 compared to the fourth quarter of  2012, according to the latest Transport Market Monitor by Transporeon and Capgemini Consulting .

This means that the transport price index is at its lowest point since 2010. The large decrease of the price index can be explained by the yearly seasonal pattern.

The price index decreased to 90.2  in the first quarter of  2013 from 98.2 in the fourth quarter of  2012.

Dennis Wereldsma, managing consultant logistics within Capgemini Consulting  said: “The current low prices for transport create possibilities for contract renegotiation. However, a sustainable relation between shipper and carrier is more valuable over time. Saving a couple percentages on transport rates can put a carrier in such a position that service levels cannot be maintained, or even worse, creating problems that are much more costly.”

When comparing to the index level of the previous year, the first quarter of  2012 (index 92.7), the price index decreased by 2.7 per cent.

In the first quarter of  2013 the diesel index fell 3.3 per cent to 105.6. Another factor with a high impact on transport prices is the capacity index, which increased by 22.5 per cent in the first quarter of  2013 (index 116.4), compared to the fourth quarter of  2012 (index 95.0).

Peter Förster, managing director of Transporeon, said: “As expected, the drop in transport prices was heavily influenced by the cold winter, in particular in February. This caused transport rates to decrease to a three year low in the first quarter of 2013. However, in March there were already signs of a recovering transport market when prices increased again. Due to seasonal factors, this recovery will likely continue in the second quarter 2013.”

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