Don't Count on a Mid-Summer Slump in July

Instead of the usual mid-summer slump, we expect July freight volume to be more similar to a typical June. An unusually robust freight forecast is based on current trends for the three main trailer types:

Van – Back-to-school season is starting already, to stock retail outlets with clothing and packaged foods as well as school supplies.

Reefer – Harvests continue in Central California, and the season hasn’t begun yet for corn, potatoes, onions and apples in the Pacific Northwest, upper Midwest and Northeast.

Flatbed – Construction got off to a late start this year because of bad weather — including late snow and heavy rains in the upper Midwest and Northeast — so machinery and supplies are still moving on flatbeds through the summer.

The strong produce season boosts demand not only for reefers, but vans, as well. Both segments transport consumer goods to major population centers, and the trailers can be interchangeable in certain circumstances. When reefer capacity is constrained, that puts pressure on vans, especially in agricultural markets. Reefer rates spike in those regions, and van rates rise, too — if a bit less dramatically.

Consumer confidence was way up in May, leveling off in June. Spending continued to increase more than anticipated, and so did income. That all bodes well for Q3 van and reefer freight movements. For flatbed, new housing starts are way up, with May nearing a seven-year high. Demand, plus weather-related delays, could extend the construction season out through Q3, and well into October.

 Manufacturing is on the rise, too. At the same time, the domestic oil boom increases demand for flatbeds to transport heavy equipment to and from drilling sites all over the country. Flatbed rates have remained high for months on the lane from Houston to Bismarck, ND, for example.

If your drivers and dispatchers were expecting to take a vacation in the slow season, they might wait until August–or December.

What about your business? Has this July busier than previous years?