The FTCR China Freight Index slipped in January, as it usually does ahead of the lunar new year. However, the headline index was above the average for this time of year, while a key measure of rates, as well as the outlook for operating conditions in the months ahead, were also relatively strong. Economic growth is expected to slow in 2018 as credit conditions tighten, but freight companies report they have had a reasonably solid start to the year.

Profitability remained elusive — these companies have not reported an improvement in their profits in three years — but rates increased while cost pressures eased slightly. The lunar new year holiday is set to start on February 16 so we expect the seasonal slowdown in the freight industry to deepen and to be reflected in next month’s reading of our index, due on February 21.

The FTCR China Freight Volume Index fell 3.9 points to 50, right on the line that separates expansion from contraction. This was 5.1 points higher than in January 2017 and above the average 45.3 for the previous 12 months. Among respondents, 60 per cent said that volumes remained the same. 

Although the FTCR China Freight Outlook index fell 5.8 points, indices measuring the outlook for profits and rates over the coming months were slightly higher relative to December.

The FTCR China Freight Rate Index rose 3.9 points to 53.9. Among respondents, 80.5 per cent said rates remained the same. 

The FTCR China Freight Cost Index fell 1.2 points to 58.3, above the average 57.1 for the previous 12 months but below January 2017’s level of 61.

The FTCR China Freight Profit Index rose 1.7 points to 44.4, below the average 45.6 for the previous 12 months and below January 2017’s 45.4. Among respondents, 70.2 per cent said profits stayed the same as the previous month.

The FTCR China Freight survey is based on interviews with 200 road, railway, waterway and air logistics companies. For further details click here. This report contains the headline figures from the latest Freight survey; the full results are available from our Database.

FT Confidential Research is an independent research service from the Financial Times, providing in-depth analysis of and statistical insight into China and Southeast Asia. Our team of researchers in these key markets combine findings from our proprietary surveys with on-the-ground research to provide predictive analysis for investors.