Rates crest as truckers ride an up-and-down market, DAT reports

April 2, 2020

Special to Land Line

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With a cresting pattern taking shape in truckload supply and demand last week, spot truckload rates on DAT MembersEdge have started to stall or decline for dry van and reefer freight as supply chains feel effects of the COVID-19 outbreak.

It’s unclear whether the trend will turn into a sharp downward rate correction, a holding pattern, or a return to the upward trajectory of recent weeks. Let’s look the numbers from last week:

National average truckload rates, March (through March 29)

  • Van: $1.87 per mile, up 2 cents from last week and 8 cents higher than the February average.
  • Reefer: $2.19 per mile, up 3 cents from last week, and up 10 cents compared to February.
  • Flatbed: $2.19 per mile, down a penny from last week, and up 4 cents compared to February.

Key trends

Van rates peak

Last week, spot van rates were higher on 71 of the top 100 high-volume van lanes on DAT TruckersEdge. And rates rose in both directions for all but 10 lane pairs. The national average spot van line-haul rate increased 4% from March 1 to March 29, but peaked on March 22 and has declined since then.

Ratios slip

The upward rate trend for vans is already shifting. Retail inventories are being depleted and replenished but slowdowns and closures at nonessential businesses have reduced the overall demand for trucks. The national average van load-to-truck ratio was 2.8 last week, down from 3.5 the previous week. This decline comes after eight weeks of increases.

Seasonal norms

The van load-to-truck ratio is now at February levels, below three loads per truck. That’s actually an improvement compared to the same period in 2019. Lower van ratios in the coming weeks would be consistent with seasonal norms, while staying ahead of 2019 trends.

Reefer rates ripen

Only one of the top 72 reefer lanes paid less last week than it did the week before. The national average reefer load-to-truck ratio fell to 4.9 from 7.8 the previous week, a sign that rates will soften until domestic produce harvests begin.

Waiting on produce

Produce volumes and timing can be unpredictable, which is why it’s a large component of spot market reefer freight. Contract carriers tend to prefer hauling fresh foods and beverages that are delivered on regular schedules: meat, eggs, dairy and frozen food.

Better in the Sun Belt

For now, spot reefer rates are still trending up in California, Texas, and parts of the Southeast.

Check out these key lanes:

  • Dallas to Columbus, Ohio, averaged $1.98 per mile, up 15 cents. Columbus to Dallas averaged $1.84.
  • Stockton, Calif., to Portland, Ore., paid $2.93 last week, up 30 cents, and has added another 16 cents this week to $3.08 per mile. Portland to Stockton averaged $2.10.
  • Miami to Baltimore gained 20 cents to $2.04, high for late March with the seasonal peak still more than a month away. Baltimore to Miami rose to $2.10; this lane will flip soon, and the northbound lane will pay more than Baltimore to Miami.

Rates are derived from DAT RateView, which provides real-time reports on prevailing spot market and contract rates, as well as historical rate and capacity trends. All reported rates include fuel surcharges.

For the latest spot market load availability and rate information, visit the load board or tune in to Land Line Now. You can get all of the latest rate information at DAT.com per industry-trends per Trendlines, comment on the DAT Freight Talk blog, or join us on Facebook. On Twitter you can tweet your questions to us @LoadBoards and have your questions answered by DAT industry analyst Mark Montague.

Rates are derived from DAT RateView, which provides real-time reports on prevailing spot market and contract rates, as well as historical rate and capacity trends. All reported rates include fuel surcharges.

For the latest spot market load availability and rate information, visit the load board or tune in to Land Line Now. You can get all of the latest rate information at DAT.com per industry-trends per Trendlines, comment on the DAT Freight Talk blog, or join us on Facebook. On Twitter you can tweet your questions to us @LoadBoards and have your questions answered by DAT industry analyst Mark Montague.

 

Here is last weeks report on truckload rates from DAT Solutions.

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