Spot reefer truckload freight demand picks up regionally

Spot reefer truckload freight demand picks up regionally

The top lanes for spot refrigerated truckload freight saw a 10% increase in volume during the week ending March 12, 2016, reported DAT Solutions, which operates the DAT network of load boards. Reefer rates are trending up in California, Texas, and Florida—all key states for produce.

The national average reefer rate edged up 1 cent to $1.81 per mile compared with the previous week, and the number of reefer load posts fell 2% while truck posts were unchanged. The load-to-truck ratio dropped 2.5% from 3.1 to 3.0 loads per truck, meaning there were 3.0 refrigerated loads for every truck posted on the DAT network.

Rising markets for spot reefer freight included Los Angeles CA, up 7 cents to $2.30 per mile; McAllen TX, up 5 cents to $1.86 per mile; and Lakeland FL, up 3 cents to an average of $1.31 per mile.

Van load posts declined 5% and truck posts increased 1%, causing the van load-to-truck ratio to fall 7% from 1.6 to 1.5 loads per truck. The national average van rate dipped 1 cent to $1.55 per mile.

Flatbed load volume rose 4% and capacity was down 5%, raising the load-to-truck ratio 9% to 16.1. The national average flatbed rate fell 1 cent to $1.82 per mile. Regionally, spot flatbed freight was strongest in the southeastern United States.

Across all three equipment types, the number of available loads and capacity on the spot market was virtually unchanged versus the previous week.

The national average diesel price climbed 8 cents to $2.10 a gallon. This gain led to 1-cent rise in fuel surcharges for vans and flatbeds.

Despite these mixed freight volume results, the trucking industry should experience far better results going forward. A recent article by Sean Kilcarr of Fleet Owner magazine explains why electronic logging devices (ELDs) will have a positive impact:

The sluggish freight volumes experienced by the trucking industry of late may not dissipate any time soon, but an impending capacity crunch driven in large measure by the mandated adoption of ELDs in 2017 should give motor carriers a huge and potentially long-term advantage—and maybe sooner than expected at that.

“Some shippers are stepping up as they ask carriers to begin installing ELDs now as [they] have decided that it is too risky to wait until the middle of December 2017 to see if [their] core carriers have sufficiently progressed in installing ELDs,” noted John Larkin, managing director and head of transportation capital markets research at Stifel Financial Corp, in a presentation at the 2016 Truckload Carriers Association (TCA) annual meeting in Las Vegas.

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.

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

For complete national and regional reports on spot rates and demand, go to www.dat.com/Trendlines.

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