Spot freight activity slows as load posts decrease, DAT reports

Activity on DAT MembersEdge decelerated last week as demand for freight trucks continues to level off from all-time highs.

The number of load posts decreased by 5% during the week ending Oct. 25, marking four straight weeks of declines. Truck posts increased by 3% and van posts were down 4%.

The spot market remains in record-setting territory, though, as the number of available loads is more than double this time last year. Van posts are up 132% year over year.

Let’s take a closer look at the numbers.

National average load-to-truck ratios

The combined effect of truck posts increasing and load posts decreasing pushed down load-to-truck ratios for all equipment types last week:

• Van LT ratio – 4.0, down from 4.2 the previous week.
• Reefer LT ratio – 7.7, down from 8.3, driven by a 6% drop in load posts.
• Flatbed LT ratio – 33.9, down from 37.2. Load posts fell 5%.

National average freight rates

National average truckload rates through Oct. 25 remain elevated and within a narrow price range since the start of the month.

• Van: $2.22 per mile excluding a fuel surcharge.
• Reefer: $2.38 per mile.
• Flatbed: $2.23 per mile.

Including a calculated fuel surcharge would add approximately 19 cents to the line-haul rate. Spot rates are one-time transactions and will vary from load to load and lane to lane.

Trends to watch

Reefer freight from the ‘salad bowl’

Around 90% of all leafy vegetables grown in the U.S. originate in the region around Yuma, Ariz., and California’s Imperial Valley, giving the area the nickname of the nation’s “winter salad bowl.” Most production takes place from November through March, with harvests packed at local salad-processing plants and shipped to major supermarket and fast-food chains. The average spot line-haul rate from the southern Arizona border market jumped by 17 cents to $2.29 a mile last week, excluding fuel. Month over month, volumes are up 54%. The salad bowl freight is starting to roll.

East Coast reefer volumes dip

In other signs of reefer market seasonality, we’re seeing early reports of fall vegetables out of Florida. Reefer volumes from Miami were up 22% week over week last week, and Jacksonville increased 16%, but loose capacity has suppressed outbound rates. Loads last week from Atlanta dropped 21% week over week, although tighter capacity pushed the average line-haul rate up 3 cents to $2.30 a mile. Reefer volumes last week from Elizabeth, N.J., fell 10% compared to the previous week, and the average outbound line-haul rate dropped a penny to $2.13 a mile.

Consumer goods keep dry vans moving

Demand for fast-moving consumer goods continues to drive the van freight market. IRI, a research firm that specializes in consumer packaged goods, retail, and over-the-counter health care markets, said that while CPG sales are up 8% year over year the e-commerce portion of that activity is up 34%. CPG and other retail freight continue to present opportunities for dry van carriers on the spot market.

Imports surge again

West Coast ports are bracing for record imports. Trucks are tight in Los Angeles and Ontario, Calif., and a wave of container freight in the coming weeks will stretch capacity further. The number of available loads last week in Los Angeles jumped 25% week over week, while Ontario volumes increased by 19%. Look for more upward pressure on spot rates in Southern California.

Rail surcharges and spot truckload freight

In Seattle, Union Pacific is doubling a $500-per-container surcharge on small shippers to move excess contract cargo by rail and intermodal. As a result, Seattle outbound spot truckload volume increased 21% week over week and nearly 17% of those loads were destined for Los Angeles and Ontario.

Watching the weather

Weather is a hot topic this week. A winter storm is forecast for the southern Rockies and Southern Plains, Santa Ana winds and wildfires are affecting travel in Southern California, and Hurricane Zeta is threatening the Gulf Coast. Watch the weather – and be careful out there.

Reminder: negotiate

These rates are averages from last week and this week will be different. Look at the rates and load-to-truck ratios in MembersEdge to understand which way prices are trending. Negotiate the best deal you can get on every haul.

Look for the latest spot rate information at DAT.com/Trendlines or take a deeper dive into the market at DAT.com/blog. Also look for DAT Freight & Analytics across your social feeds on Facebook, Instagram, and Twitter, and join the DAT iQ team live on YouTube or LinkedIn Live at 10 a.m. Eastern every Tuesday.

Got questions or comments? Send us an email to AskIQ@dat.com.

Stay safe, and thank you for your hard work. LL