As 2013 winds down, I continue to be surprised by the ongoing demand and persistent rate stability in the spot freight market. I have written several blog posts about various explanations for this year's unusual trends, but this week, I'll just confine myself to describing the situation. You can draw your own conclusions -- and please feel free to share them in the Comments section, below!
Van Rates Level Off Instead of Waning
Rates continued to crest last week for vans, rising 0.3% instead of retreating as expected. Volumes appeared to drop, although some lanes showed increased load availability, and spot market load posts increased 6% for vans. Nationally, van rates were unchanged and remain 17¢ higher than in December 2012. The most interesting markets last week were Columbus as a supply point and Buffalo as a demand point.
Pockets of high activity appear all across the U.S. The upper Midwest shows unusual strength for this time of year and only California looks relatively slow, with Texas mixed. Even Florida is showing strength for van freight.
Reefers Lose 4¢ for the Week, Up 7¢ Vs. 2012
Reefer rates slipped four cents lower but remain 7¢ higher than in December 2012, a strong finish for refrigerated freight in 2013. Florida and south Texas are producing well during the grapefruit season. Imported produce, chiefly from Mexico, is keeping border crossings busy at Laredo and Nogales, and produce harvests are continuing in California's Imperial Valley. Meanwhile, reefer shortages continue in Idaho, Minnesota, Nebraska, and Wisconsin. This is mostly potatoes but also some beef, dairy items and other food products. In the South, tomatoes and mixed vegetables are popular commodities and are moving well.
Flatbeds Surprise with 4¢ Rate Rise
Flatbed rates rose 4¢ last week, which was the big surprise. This may be the result of companies beefing up forecasts for 2014 and trying to buy at current prices before the new year. Flatbed rates are up 5¢ in December 2013 versus December 2012, for the first year-over-year gain in months. Regionally, the Southeast is leading, alongside the Rockies and the Midwest. Florida and Texas are slow as is typical at this time of year, with the Houston market remaining stable. The epicenter for that region appears to have shifted to Memphis for now. Ontario, CA shows moderate activity.