Regional Snow Delays Freight Deliveries and Boosts Inbound Rates

Last winter's Polar Vortex still haunts transportation professionals across North America. This year, winter storms are severe, but the impact is mostly local or regional. What's different?

Here is Wednesday's weather map from National Oceanic and Atmospheric Administration (NOAA), an agency of the U.S. Department of Commerce:

The NOAA is predicting snow in the Northeast and Midwest - again! Snow is in the forecast for the Rocky Mountain States with impact from western Texas, all the way to the eastern portions of California, Oregon and Washington, and north into Canada.

NORTHEAST: New England has been absolutely buried. That region is not a big source of freight, but it is a major destination, so when roads in and around Boston are impassable, a backlog can develop in the freight hubs that service that area. In recent weeks, spot market rates surged for outbound vans from Philadelphia and Buffalo. Snow is not uncommon in those markets during the month of February, and the municipalities usually do a good job of clearing roads. However, those cities are among those major freight hubs that ship into New England and New York, so there are times when the outbound trucks have nowhere to go.

SOUTHEAST: Rain is expected in the Southeast, which should help to clear the roads of recent accumulation. The thaw may eventually lead to declining rates from Memphis and Nashville, as well as markets in the Carolinas and Virginia.

Rates rose out of Atlanta last week, but only on northbound lanes. About half of Atlanta's outbound freight remains within the Southeast region -- and most of that is bound for Florida -- so unless the Atlanta area itself is snowed in, the weather effects are not as severe as they might be in Memphis.

MIDWEST: The Great Lakes are frozen over, and the whole region has been inundated with snow, but flatbed freight is still rolling out of Cleveland, Detroit, Indianapolis and Pittsburgh. Auto manufacturing is a growth industry right now, and those metro areas are in the mix.

SOUTH CENTRAL: Oklahoma and Texas got clobbered with snow and ice early this week, disrupting freight movements into and out of Dallas, among other markets. Other economic factors also took their toll on Texas freight, as the drop in oil prices made some drilling sites less viable, leading to a significant reduction in flatbed shipments of heavy equipment and pipe. One result is that Houston, until recently the largest source of flatbed freight on the spot market, has yielded that crown to Cleveland.

WEST: Weather has not been a big factor in major freight markets along the West Coast, Instead, the focus is on the recent, tentative agreement between dockworkers and the port authorities. Cargo is already being offloaded and transferred to warehouses, then trucks and trains. The backlog may take weeks to clear, putting the squeeze on outbound capacity and rates from Los Angeles and, to a lesser degree, other West Coast port cities.

Categories: Rate Trend of the Week



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