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FTA transport operator survey reveals ‘patchy’ growth and optimism

Research from the Freight Transport Association (FTA) reveals a ‘patchy’ start to 2011 for transport operators, with activity levels varying considerably between industry sectors and from quarter to quarter. However, data from FTA’s Quarterly Transport Activity Survey (QTAS) for April 2011 shows that there is an undercurrent of optimism in the second quarter of the year with road freight activity expected to increase across all sectors.

Bruce Goodhart of FTA’s information team said:
"The growth in domestic road freight was generally weaker than expected for quarter one with the exceptions of the construction, public authority and waste disposal sectors, which all showed better than expected growth.

"While our data points to a pretty depressed market still, some comfort can be found in our respondents’ optimism that growth is just round the corner. With operating costs having risen at twice the rate of inflation and the number of insolvencies having increased by a third on the previous quarter, this is surely a welcome sign."

Rail freight growth expected.
Rail freight respondents anticipate that the extent of growth in the demand for bulk rail services will increase in Q2 2011, reflecting stronger construction traffic growth and an increase in steel volumes, mirroring the UK’s overall improvement in manufacturing competitiveness due to sterling’s relative weakness. Growth in demand for intermodal rail freight services is also expected to increase in the second quarter of 2011, reflecting the extent of growth in road freight activity anticipated by the retail and wholesale sectors in Q2.

Christopher Snelling, FTA’s Head of Global Supply Chain Policy, said:
"Expectations of growth in terms of the movement of bulk goods by rail – where it is undoubtedly king – is a healthy sign of economic recovery for our heavy industries. Aside from this reassuring sign, the expected growth in intermodal rail freight services also shows that rail is playing more of a part in moving goods than would otherwise go by truck.

"However, if government projections for rail freight to double in size by 2030 are to be realised, rail freight’s interests must be protected against those politically more saleable passenger interests."

Aftershock of Japan’s earthquake felt by air and maritime sectors.
Air freight volumes to and from the UK are generally expected to remain unchanged in Q2 2011 with the exception of the Far East which, as with deep sea freight, reflects the disruption to supply chains for finished goods and components from Japan following the recent earthquake there.

Snelling concluded:
"As well as the immediate and tragic consequences of the tremendous devastation caused by the earthquake in Japan, the supply chain is also telling its own story. Unsurprisingly, given the magnitude of this still very recent natural disaster, imports to the UK by air from Japan – typically electronic components, SIM cards and car parts – are expected to be largely inactive in the second quarter of 2011."

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