Reefer demand dips with lower produce volumes

Reefer volumes are down year-over-year driven largely by the decrease in produce volumes, which according to last week’s USDA data are down 18% y/y for domestic loads of produce (53% of total produce volume).

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Top 10 Market Watch

In the refrigerated sector, volumes increased in all top 10 markets, but spot rates dropped in all but two markets - Elizabeth, NJ, (#2) and Indiana (#5). 

Available capacity tightened quickly last week in Indiana where spot rates jumped $0.13/mile to $2.61/mile for outbound loads. In contrast, capacity loosened in Twin Falls (#10) as rates dropped $0.14/mile to $2.85/mile with a similar rate decrease in Ontario where rates fell $0.16 to $3.05/mile. 

Last week’s reefer LTR bounced back to pre-Thanksgiving levels ending the week at 9.16 loads per truck.

In stark contrast to dry van load post volumes, reefer load posts were down 1% compared to the weekly average for the prior two months - a sign the reefer market may have reached the peak we normally see around Thanksgiving.  

Reefer load post volumes remain 53% higher y/y. Available capacity didn't tighten as much as it did in the dry van sector last week and compared to the prior two months, 3% more trucks posted for reefer loads.

Spot rates in the reefer sector headed south last week as they do each year right after Thanksgiving. 

After spiking at $2.57/mile prior to Thanksgiving, spot rates dropped $0.09/mile to end the week at $2.48/mile.  Reefer rates are still $0.57/mile or 30% higher compared to the same week in 2019, but are definitely following downward seasonal trends albeit from record high levels for this time of the year.

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Dean Croke

Dean Croke is principal analyst for DAT iQ, the freight data and analytics operation at DAT. He brings 35 years of experience in the fields of data science, supply chain management, logistics, risk management and human performance. For the latest market updates, follow @LoadBoards on Twitter.