DAT Solutions: Spot rates rise to start to September
September 12, 2019
•Special to Land Line
A strong finish to August continued into September as spot truckload rates on DAT MembersEdge moved higher last week.
The number of posted van, reefer, and flatbed loads from Sept. 2-8 fell 7% compared to the previous week while the number of available trucks declined 12%.
But last week included Labor Day, and drop-offs of 20% are more typical when you compare a shorter workweek to a full one. Hurricane Dorian altered supply chains with rates and volumes rising on many lanes into and out of coastal areas. Because the worst of the storm missed heavily populated areas in the United States, the effects on transportation thankfully weren’t as severe as predicted.
National average spot rates, September 2019 (through Sept. 8)
- Van: $1.88 per mile, 7 cents higher than the August average.
- Flatbed: $2.21 per mile, 1 cent higher than August.
- Reefer: $2.19 per mile, 5 cents higher than August.
The van load-to-truck ratio peaked at 3.5 last week before settling to an average of 2.7. Van rates tend to rise when the ratio tops 2.5, and indeed, rates on 68 of the top 100 biggest van lanes by volume were higher compared to the previous week.
Where rates were up
Atlanta ($2.16 per mile, up 5 cents); Charlotte, N.C. ($2.10 per mile, up 6 cents); and Philadelphia ($1.83 per mile, up 6 cents) paced rising markets as shippers moved goods ahead of the weather. Generally, rates increased on lanes moving toward the path of the storm:
- Charlotte to Lakeland, Fla.: $2.37 per mile, up 19 cents.
- Allentown, Pennsylvania, to Richmond, Va.: $2.58 per mile, up 15 cents.
- Philadelphia to Charlotte: $1.68 per mile, up 15 cents.
The national reefer load-to-truck ratio averaged 5.0, a half point better than the August average. And reefer rates moved higher for the second week in a row.
Where rates were up
California and Michigan harvests and storm-related supply chain shifts boosted demand for reefers. Leading markets:
- Grand Rapids, Mich.: $3.66 per mile, up 26 cents.
- Sacramento, Calif.: $2.76 per mile, up 6 cents.
- Atlanta: $2.60 per mile, up 10 cents.
- Elizabeth, N.J.: $1.94 per mile, up 7 cents.
Elizabeth to Boston saw the average rate rise 42 cents to $4.36 per mile. That’s the highest rate we’ve seen for refrigerated freight, at least for freight moving more than 225 miles.
Tri-haul of the week
Western Michigan is hot for reefers, with several lanes paying above $3 per mile. Grand Rapids to Atlanta averaged $3.51 per mile, but the return paid $1.63, for a round-trip average of $2.57 a mile.
Instead of going straight back to Grand Rapids, let’s add a leg to Louisville, Ky. Atlanta to Louisville paid $2.02 per mile last week while Louisville to Grand Rapids averaged $2.37. It doesn’t add distance to your trip but the extra pick and drop would increase your revenue by $441 for a grand total of $4,512.
Remember, these rates are averages from last week and this week could be different. Negotiate the best deal you can get on every haul, and check MembersEdge to understand which way the rates are trending.
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 MyMembersEdge.com 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.