According to the Upply database, the prices of road freight transport in France are on the rise by 0.6% as of July 1st, 2019 compared to June 1st,2019, but remain down by 0.9% compared to July 1st, 2018. This confirms the small deflation that we had observed last month.
The downward curve since the 1st of this month (-1.1% on July 15th) is very unusual for the July period. It is normally a very active month: on the one hand the demand remains strong before the lull in August and on the other hand, the beginning of drivers’ summer holidays generates a lack of transport capacity. Historically, prices rise in July.
The transport market on a national level
The data for transport prices observed on the UPPLY platform indicate that the median price per kilometre of general merchandise transported was at € 1.49 / km (including diesel) on July 15th, 2019, that is to say - € 0.02 compared with July 1st, 2019 and - € 0.06 over a rolling year. This downward trend over 1 month is all the more surprising because diesel prices have increased by almost 4% over the same period (see main indicators below).
At least two reasons may explain this sharp drop in prices: the poor figures concerning the German economy and the heat wave.
• The German car industry is experiencing a sharp drop in orders, which frees up transport capacity across Europe and therefore drives prices down in all neighbouring countries.
• Furthermore, the beginning of July was hit sharply by the heat wave in France, creating completely contradictory situations. This resulted in the transport of beverages (such as mineral water, soda or beer) and refrigerated transport being greatly sought after. This has caused an extremely significant rise in demand and has created local tensions reported by both shippers and carriers. But on the other hand, other sectors affected by the heat wave have reduced their orders, which has reduced the activity of secondary distribution. In a way, this has helped to reduce the harsh working conditions of the drivers; and of course, I spare a thought for those who have continued their service under infernal conditions.
Let's keep this figure in mind: 70% of our activity is subject to changes that are seasonal and therefore also climatic!
Focus on the Rhone Valley
This region was the most heavily hit by the heat wave in late June / early July, with temperatures exceeding 45 °C in some places. Let us take a look at this major artery running between Lyon and Marseille.
The transport price curve in this region, as shown in the graph below, seems much more "volatile". The fall in prices since the summer of 2018 has been very rapid and severe, reaching -3.5% over a year.
The transportation spot market is much more developed in the region than nationally. This explains the strong variations. As a result, in June 2019, prices fell by 2.9% in one month! Moreover, this drop was carried through to July 2019 as it was for the French average.
The median price per kilometre of general merchandise transported was at € 1.62 / km (including diesel) on July 15th, 2019, which is + € 0.11 compared to the French average, this whets the appetites of carriers who are finding less work elsewhere in Europe.
LES PRINCIPAUX INDICATEURS