It feels like we've been waiting a long time to see freight volume and rates rise on the spot market -- but it's definitely happening now. Spring has sprung, and it's not a gradual process, like the first tulips of the season. This year's growth is explosive, with pent-up demand propelling the spot market up like a rocket on the Fourth of July.
Texans pay more for VANS
Van rates rose 3 cents in a single week to a national average of $1.82. This includes a .5-cent jump in major markets. Texas hosted the biggest rate swings, a 7-cent (4.4%) jump in Dallas, the major regional hub, plus an 8-cent (5.3%) increase in Houston.
Part of the one-week boost from that city originates with a 19-cent increase in the lane rate from Houston to Oklahoma City, which may be fueled by tornado relief efforts. If so, the rate will likely decline from today's all-time high of $1.96 per mile. Note that this is the rate paid by brokers to carriers, but its within 2 cents of the current shipper contract rate.
REEFERS are hot in California
Rates are rockin' and reefers are rollin' in the Golden State, especially in central California produce markets surrounding Fresno, up 20 cents (8.2%) to $2.65. This is the time of year when reefer rates in those fertile areas surpass the pay from Santa Ana -- currently holding steady at $2.58 per mile -- and the "Inland Empire" surrounding Ontario, where rates rose 9 cents last week to $2.53 per mile including fuel.
Curiously, rates are still trending up in Lakeland, Florida. Although an insect-borne bacterial disease threatens citrus trees throughout the state, a robust vegetable crop boosted freight volume, and rates rose by 26 cents to $2.45 per mile despite the relative lateness of the season. Expect the Sacramento and Twin Falls markets to heat up in June.
FLATBED rates are all over the map
Demand is strong and rates are high for flatbeds in a handful of markets, all east of the Mississippi: Outbound rates from Cleveland got an 18-cent (8.6%) per mile boost last week, for example. Harrisburg rates rose 23 cents (8.0%) last week to $3.23, but that doesn't offset the declining rates of the past month. Five markets in the Southeast are paying more than $2.50 per mile: Atlanta, Savannah, Raleigh, Roanoke and Memphis.
Other than those bright spots, the flatbed market looks...well...flat. Mixed signals on the economy may be responsible, including a downturn in the steel industry, confusion in construction and recent announcements of temporary shutdowns at General Motors plants.
Rates are excerpted from DAT RateView, and include both the line haul and fuel surcharge in a blended rate unless otherwise noted.
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Categories: Rate Trend of the Week