Rates Remain Elevated, as Seasonal Demand Blossoms

Storm-related bottlenecks are finally clearing the supply chain, just in time for seasonal freight to fill up any excess capacity.

Van rates are staying up, continuing to achieve record peaks each week, but at least the rate of change is slowing. The national average line haul rate for vans rose 0.5% last week in DAT RateView, to a whopping $1.60. That was the last bump in a 6.7% increase from February to March. Add the fuel surcharge, and you are talking about $2.10 per mile, as a national average for vans. That's crazy high.

Headhaul lanes originating in the Southeast lead the upward charge for vans, with big gains posted in Memphis ( 9.6%), Atlanta ( 6.7%), and Charlotte ( 6.9%) during the month of March. Outside that region, van rates rose in two other major freight markets last month: Dallas ( 5.2%) and Los Angeles ( 5.4%.) Meanwhile, freight volume and rates declined last week in many backhaul lanes, countering the most recent trends. Because headhaul lanes are defined as the higher-priced direction in a lane pair, the rate increases in headhaul lanes have a disproportional influence on the national average rate.

Reefer rates are slightly elevated, considering that the peak season is still two months away. California markets are trending up, with significant rates increases last week outbound from Fresno ( 6.0%), L.A. ( 4.3%), Ontario ( 4.1% and Sacramento ( 3.8%.) Outside the Golden State, Agricultural products are also driving rates Texas, with a big boost in McAllen ( 5.7% last week and 13% for the month of March) as well as Dallas ( 3.7% and 7.3%) a major distribution point for fresh and processed foods. A combination of pent-up demand from the winter, plus new, seasonal freight, is also filling the pipeline and driving rates up in Green Bay ( 6.7%.)

 



Peggy Dorf

Peggy joined DAT in 2008 as a writer and market analyst. She was instrumental in developing DAT Trendlines, and she writes extensively about the impact of economic trends on companies and individuals in transportation and logistics. Peggy is a Certified Transportation Broker with decades of experience in technology marketing and an MBA from the Wharton School.



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