With the second quarter quickly coming to a close, data issued by DAT, a subsidiary of Roper Technologies and operator of an online marketplace for spot market truckload freight, showed significant increases in truckload rates and ratios, for the week of June 22-28, as shippers take steps to get their freight moving in advance of the Fourth of July holiday and the mid-year point of 2020.
In a blog post, DAT Carrier News Editor Matt Sullivan observed that spot market demand for dry van truckload shipments gained traction for the week ending June 28, which was paced by retail freight activity translating into tighter capacity and higher rates.
What’s more, Sullivan also observed that the rush leading up to the Fourth of July has translated into load-to-truck ratios in certain markets, including Memphis, which he said is a major retail warehousing market, as well as increases for key retail shipping lanes originating out of Columbus, Ohio.
Looking at produce harvest, the blog posting said things remain on a typical seasonal pattern, but that comes with the caveat that recent increases in COVID-19 cases are creating uncertainty, with a rise in cases in Texas and Arizona. And Sullivan added that refrigerated (reefer) volumes were steady on a sequential weekly basis, with the number of lanes that have higher rates compared to those with lower rates at mostly even levels.
For the week of June 22-June 28, DAT reported the following rates, that are derived from transactions between carriers, brokers, and shippers, including:Memphis to Atlanta increased 16 cents to an average of $2.40 per mile; Memphis to Indianapolis was up 20 cents to $2.23; Memphis to Columbus rose 19 cents to $2.14; Higher volumes on the lane from Houston to Chicago pushed the average rate to $1.78 per mile, 18 cents higher than the previous week; Out west, the lane from Los Angeles to Denver kept climbing, hitting $3.16 last week; Only 11 of the top 100 van lanes had lower prices last week, with the biggest drop on the lane from New Orleans to Dallas, where prices had previously spiked due to Tropical Storm Cristobal. Rates were back down 15 cents to $1.68 per mile last week
In a recent interview, Ken, Adamo, DAT Chief of Analytics, explained that current spot market activity levels are in line with where things were in 2019, 2015, and 2017.
“It is kind of that seasonal peak,” he said. “The thing is the year plays out quite differently from here on out. 2019 and 2015 each sort of crested out of the produce and spring shipping season and had fairly mediocre second halves of the year. 2019 shot out of a cannon, and in 2017 Hurricane Harvey pretty much lit things on fire to end the year. And 2018, as we all know, from a rate perspective, was a landmark year. It is good to see things recover on the reefer and dry van side to pre-COVID-19 levels, where we were sitting before. What will be interesting to see is how bullish are retailers and wholesalers heading into the fall season. I think that will play a lot into what the rate picture looks like over the third and fourth quarter.”