Flatbed Report: Another strong quarter for flatbed carriers

Last quarter was another excellent for carriers primarily in the flatbed and specialized sector, confirmed on the recent quarterly earnings call with Daseke, Inc. (NASDAQ: DSKE), the largest flatbed and specialized transportation and logistics company in North America. 

Daseke’s fleet consists of approximately 4,565 total tractors (down 6.3% y/y) and 11,051 flatbed and specialized trailers (down 3.7% y/y). The Texas-based carrier reported first-quarter revenue of $421 million, up 26.1% y/y. The adjusted operating ratio for the 1st quarter was 93%, improving on the 95.5% operating ratio recorded in the same quarter last year.

According to Jonathan Sepko, Chief Executive Officer of Daseke, “Strong end-market demand in each or our flatbed and specialized reporting segments continued to outweigh available capacity. These operating segments realized higher rates, contributing to the meaningful year-over-year revenue growth we experienced this quarter. Daseke’s Flatbed Solutions segment benefitted from continued strength and year-over-year improvement in the freight rate environment, with rates up 21% to $2.59/mile compared to $2.14/mile in 1Q21. In Daseke’s Specialized Solutions segment, sustained demand and improving freight rates primarily in the construction, high-security cargo, and commercial glass end markets pushed rates up 22% y/y to $3.40/mile from $2.78/mile this time last year. According to the earnings call report, this improved result is despite muted wind energy volumes. 

In Gary, IN, the largest steel-producing market for loads south to Pittsburgh, flatbed capacity eased considerably last week. Spot rates dropped to $3.28/mile excl. FSC, which is $0.82/mile lower m/m and $0.69/mile lower than the previous year. In Houston, DATs largest flatbed market, capacity also eased on the number one lane north to Ft. Worth weather spot rates dropped by around $0.50/mile below the April average to $3.37/mile excl. FSC this week. Capacity also eased for loads to the Permian Basin oilfield last week, with spot rates down by $0.40/mile below the April average to an average of $3.28/mile excl. FSC. That’s still $0.67/mile higher than the previous year.  

Flatbed load post volumes surged last week, increasing by 18%, and are now 27% higher than this time in 2018 and just 1% higher than the previous year. Volumes have increased by 27% in the last month, while carrier equipment posts have steadily increased over the last five weeks. As a result, last week’s flatbed load-to-truck (LTR) ratio increased by 49% w/w from 70.02 to 72.66. 

After being relatively flat for the first four months of this year, flatbed spot rates dropped for the third week in succession following last week’s $0.03/mile decrease. Flatbed rates ended the week at $2.64/mile excl. FSC, which is about the same as this time last year but $0.28/mile higher than the same week during the 2018 flatbed rate rally.

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