Spot market rebounds after Thanksgiving, DAT reports

Spot truckload freight volumes bounced back after Thanksgiving as the number of available loads on DAT MembersEdge increased 93% last week.

Big swings are typical when you compare a full workweek to one with a major holiday. The more telling stat is that there are nearly double the number of available loads on the board compared to this time last year while the number of trucks posted is down 9.7%.

While spot rates have been setting records, there are signs that pricing is beginning to soften for the first time in more than seven months.

Let’s take a closer look at the numbers.

National average load-to-truck ratios

National average van, reefer, and flatbed load-to-truck ratios on DAT MembersEdge jumped last week.

• Van LT ratio: 5.9, up from 3.8 the previous week and well ahead of the November average of 4.5.
• Reefer LT ratio: 9.0, up from 6.3 the previous week.
• Flatbed LT ratio: 35.8, up from 24.9.

Load-to-truck ratios represent the number of loads for every truck posted on DAT load boards. The load-to-truck ratio is a real-time indicator of the balance between spot market demand and capacity, and changes often signal impending changes in rates.

National average rates, December

Spot rates held up well last week compared to the November averages:

• Van – $2.52 per mile, 8 cents higher than November.
• Reefer – $2.71 per mile, 2 cents more than November.
• Flatbed –$2.43 per mile, the same as the November average.

These are national average spot rates for the month through Dec. 6. These averages are based on actual transactions. DAT doesn’t set spot rates—each transaction is individually negotiated between the carrier and the broker or shipper and will vary from load to load and lane to lane.

Trends

Beware the post-Thanksgiving freight lull

Rates and load movement dipped on DAT’s top 72 reefer lanes by volume last week. The average rate was higher on just 17 lanes, 54 lanes were down, and one was unchanged. Volumes on these lanes decreased 11% compared to the previous week, a sign that the reefer market may have hit the peak we expect to see around Thanksgiving.

All told, reefer truckload volumes are down year over year largely because of the depressed food services sector. According to last week’s U.S. Department of Agriculture data, domestic loads of produce (which account for 53% of total produce volume) are down 18% year over year.

On the spot market, reefer load post volumes are up 53% year over year.

Van movements reflect retail changes

Dry van load postings spiked to a five-year record last week, up 21% compared to the weekly average for the prior two months. Carriers got back to work quickly after the holiday with 8% fewer trucks posting for loads compared to the weekly average for all of October and November.

The number of loads moved in DAT’s top 100 van lanes by volume increased 6.7% last week compared to the previous week and the average outbound spot rate was higher on 53 of those lanes. Twenty-five lanes were neutral and 22 saw rates fall.

One surprise: Los Angeles and Ontario, Calif., have been among the top three van markets for volume during most of October and November. Available capacity has been tight in Southern California following the surge in imports on the transpacific shipping lane from Asia, driving up spot rates. But last week the supply/demand balance shifted and outbound rates fell in both markets.

Good news for manufacturing freight

The Institute for Supply Management reported higher manufacturing demand, consumption, and inputs in November compared to the previous month. While new orders and production both fell last month, they were still at healthy levels – encouraging news for flatbed carriers.

Of DAT’s top 78 flatbed markets, the average outbound rate was higher in 25, lower in 23, and neutral in 30 last week, and the number of loads moved in those markets declined by 3.6%. Rates in most high-volume markets have been flat over the last two weeks, but several stand out for their ups and downs:

• Jacksonville, Fla.: $2.64 a mile, up 20 cents since Nov. 20.
• Raleigh, N.C. – $2.68, up 9 cents.
• Rockford, Ill. – $3.19, down 12 cents.
• Harrisburg, Pa. – $3.64, down 9 cents.
• Roanoke, Va. – $3.18, down 9 cents.

These rates are averages from last week and this week will be different. Check MembersEdge to understand which way the rates are trending and negotiate the best deal you can get on every haul.

Listen to a discussion about freight and rates on Land Line Now.

For the latest spot rate information, visit DAT.com/trendlines. Got questions or comments? Send us an email to AskIQ@dat.com.

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