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A lot of the spot market freight volumes that were stalled in the aftermath of Hurricane Harvey have started to come back. Last week, Houston’s van freight volumes rebounded to 88% of pre-storm levels. That’s a quick turnaround, especially in the Labor Day week that included only four business days.
Outbound volume recovered in Dallas too, so traffic is moving throughout most of the state now. All Texas rates came down from the huge spike we saw in the previous week, but they’re still quite a bit higher than they were before the storm hit. That doesn’t mean that everything is the same as before – some cargo is not moving at all, and other types of freight are moving in higher volume because of pent-up demand.
Of course, this was all before Hurricane Irma struck Florida. Our hearts go out to all those whose lives have been turned upside down by these two mega-storms, the wildfires in the West, or the earthquake in Mexico.
As recovery efforts continue, truckloads of emergency relief supplies from FEMA and non-governmental groups are moving into the affected areas. In the meantime, truck capacity was already getting tight on the spot market last week, boosting national load-to-truck ratios for both vans and flatbeds.
Diesel prices also continued to climb after a big spike from the week before. The national average price rose another 4¢ to $2.80 per gallon at the pump. That put even more pressure on freight rates, accounting for 3¢ added to the national average for each trailer type.
Recovery efforts are also underway in Florida. Atlanta and Charlotte are the two major van markets that serve Florida, and outbound rates soared in those markets, but volumes were down. That means the storm threat might have led shippers to cancel or postpone some freight movements instead of expediting them.
The ports in Savannah, Tampa, and Miami all suspended operations over the weekend, while the Port of Charleston closed on Monday. The ports should be back online now, but there could be some pent-up demand this week as a result of the closures. Also, some ships may have been re-routed from Houston to East Coast ports, so that will add to the pressure in port cities and regional hubs.
Another secondary effect from the storm was that outbound rates rose in Philadelphia and Buffalo. That’s a common trend when the flow of freight shifts southward. More freight is bypassing the Southeast altogether, and entering the Northeast from the Midwest. A lot of it gets warehoused in Buffalo, Philadelphia, and nearby Allentown before proceeding to the bigger population centers, including the New York metro area.
All rates below include fuel surcharges and are based on real transactions between carriers and brokers.
Rates were generally up everywhere, with the least amount of change in California. Rates had already risen on a lot of lanes across the country, even before Hurricane Irma hit. Those prices could shift again this week, though. If you’re taking freight into Florida, remember that it’ll likely be even harder than usual to find loads coming back out.
- Atlanta to Lakeland, in central Florida, jumped up 25¢ to an average of $2.94 per mile, and prices have continued to climb on that lane this week
- Charlotte to Lakeland also spiked 36¢ to $2.89 per mile last week, but this lane rate is already trending back down
There was also a lot of activity between Charlotte and Atlanta, and van rates rose in both directions.
- Charlotte to Atlanta was up to $2.57 per mile
- Atlanta to Charlotte hit $2.61 per mile
Secondary impacts were felt on lanes like Allentown, PA to Richmond, VA, where rates were up 29¢ to $2.64 per mile. More surprising was the lane from Chicago to Buffalo – it’s been up and down all month, but it skyrocketed 82¢ to $3.30 per mile last week
The sharpest rate declines were in Texas, but only compared to a week when intrastate lanes hit the highest prices we’ve ever seen. Trucks have been delivering FEMA loads and other emergency relief cargo to the area, and then they were leaving empty or sticking around to find a load out. More available trucks means that rates are going to fall, and that’s starting to happen now on outbound loads from Houston and Dallas, in particular.
- Dallas to Houston rates fell an average of 54¢ but were still high at $3.49 per mile
- Denver to Houston also dropped 31¢ to $1.35 per mile, which is still higher than it was before Harvey. Denver was being supplied out of Chicago while Houston was underwater, but the Houston-to-Denver head haul should be back online by now
- The biggest decline on outbound Houston lanes was the one to New Orleans, which fell 63¢ from a record high and is now down to $2.61 per mile. That’s still pretty high. Before Harvey, the same lane paid $2.32.