A gantry crane loads cargo onto a freight train bound for Central Asia at the Jiaozhou Bay International Logistics Harbour in Qingdao, east China's Shandong Province, May 7, 2018. (Xinhua/Guo Xulei)

The logistics prosperity index (LPI) in September rose for the first time in four months, reaching its highest point in the year, indicating robust business activities and increasing demands in the logistics industry, according to an industry report released on Tuesday.

According to the report by the China Logistics Information Center, the LPI surged 2.9 percentage points to 53.8 in September after dropping for four consecutive months, reaching its highest reading of the year thus far. The sub index of new orders also jumped 2.3 percentage points to 53, indicating rising demands in the overall logistics industry. Readings above 50 imply expansion, and readings below fall into contraction territory.

The rise in the sector's LPI is a response to a more active business environment overall, buoyed by seasonal growth of demands during the Mid-Autumn Festival and the National Day holiday in September and early October, according to He Hui, director of the China Logistics Information Center. Expanding business activities in the production of commodities such as steel, iron and metals, as well as the rise in food and household appliances industries, also pushed demands in the logistics sector, according to He. 

The sub index for investment in fixed assets, which read 52.5, rose 1.8 percentage points from August. The rally indicates an overall improvement in the condition of infrastructure in the logistics sector.

With the sub index of business expectations perched at 60.9, business confidence in the sector is continuously growing and employment in the sector is also rising steadily, He said. Regional sub indexes show that East, Central and West China all witnessed significant growth, with the climb in West China particularly evident.

However, the inventory index, which read 52 in September, dropped 2.3 percentage points from August. The drop indicates that despite rising demands, the industry is still strained from high inventory costs, Wang Yong, assistant to the president of CMST Development Company, said in a report by cnstock.com.

The LPI is an indicator of the performance of the logistics sector that was introduced by the China Federation of Logistics & Purchasing and the China Logistics Information Center in 2013.