E S T I M AT I N G F R E I G H T D E M A N D

Cadacio, Joyce Karen R.

FREIGHT
TRANSPORTATION
The management aspects of
freight transportation, known as
business logistics or operations
research, are concerned with the
movement and storage of goods
between the primary source of
raw materials and the location of
the finished product.

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Two approaches or methods in
estimating freight demand:
First Approach/Method

based on observation of
vehicle flows

Second Approach/Method

based on the use of commodity flow

data
Using Trend Analysis of Freight
Vehicle Travel

The forecasting methods

presented in this chapter for passenger
travel are equally suitable for freight
travel forecasting. At the state level,
freight flows may be computed using
the trend analysis of traffic flow that
forecasts freight movements by truck
and rail or may be determined directly
from observations of prior goods
movement activity.
EXAMPLE
Using Commodity Flow Data to
Forecast Freight Vehicle Travel

A more productive approach for

estimating freight travel is to base
forecasts on commodity travel. Once
commodity flows are estimated, they can
be converted to vehicle flows. This
conversion must be based on the payload
for each mode (which will vary by
commodity), the extent to which there
are empty (return) trips, and the number
of days per year that the mode will be
operable.
Table below compares the advantages and disadvantages of the
principal forecasting methods.
 Based on the 2014 COMMODITY FLOW in
the PHILIPPINES.
This is the commodity classification of the Philippines.
The commodity classification used in the compilation of the
data is the 1993 Philippine Standard Commodity Classification (PSCC)
which is aligned with the United Nations Standard International
Trade Classification (SITC) Rev. 2.
The classification is presented in five levels of details: section,
division, group, subgroup and item. A unique code number identifies
each commodity. The code number of each commodity is so designed
that the first digit identifies the section; the first two digits, the
division; the first three digits, the group; the first four digits, the
subgroup; and the five digits, the item.
Example of Commodity Flow Data