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By Mark Montague, DAT Solutions
Two trends have driven the spot truckload freight market this year: strong volumes and abundant capacity.
The number of van loads increased 2.4 percent in April compared to the same period last year, and dry-van freight has been plentiful into May. And unlike last April, when enforcement of the ELD mandate took effect and capacity momentarily fled from the market, there's been no shortage of available trucks this year.
The national average load-to-truck ratio for vans has lingered at or below two loads per truck since January, due to the availability of trucks. For comparison, we typically consider a ratio between 2.5 and 3 to be balanced, while ratios below 1.75 usually lead to lower rates.
As a result, it's been a shipper's spot market: national average van rates have fallen from $1.95 per mile in January to around $1.80 at the start of May.
Spot reefer rates have slipped as well, from $2.31 per mile in January to $2.15 per mile in May. But reefer freight volumes? Like everyone else, truckers are still waiting.
Delays in spring produce have led to a decline in available reefer freight, with volumes down 11 percent in April compared to March. On a year-over-year basis, reefer volume decreased 2.9 percent in
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The national average reefer load-to-truck typically begins to increase in April as produce season kicks into gear. This year, with farmers in the Midwest recovering from a bad spring, that ratio has fallen steadily from 4.0 in January to 2.3 in mid-May. The ratio averaged 7.0 in May 2018.
April and the average spot rate was down by 28 cents per mile.
The national average reefer load-to-truck ratio has fallen steadily from 4.0 in January to 2.3 in mid-May. The ratio averaged 7.0 in May 2018.
While lanes out of California and Florida have predictably seen a rise in traffic and produced stronger rates for truckers, reefer volumes are down throughout the Midwest, where the recovery from disastrous weather continues.
May is usually the start of a busy time for reefer carriers. Right now, it's hard to know what to expect.
Mark Montague is senior industry pricing analyst for DAT Solutions, which operates the DAT® network of load boards and RateView rate-analysis tool. He has applied his expertise to logistics, rates, and routing for more than 30 years. Mark is based in Portland, Ore.
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