Dry Van Report: Truckload demand still higher than this time last year – DAT Freight & Analytics

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The American Trucking Associations’ (ATA)  superior seasonally adjusted (SA) For-Rent Truck Tonnage Index elevated 2.7% in June after rising 0.3% in Could. In contrast with June 2021, the SA index elevated 7.9%, the tenth straight year-over-year acquire and the biggest since June 2018. The not seasonally adjusted index, which represents the change in tonnage really hauled by fleets earlier than any seasonal adjustment, equaled 124.5 in June, 4.2% above the Could stage (119.5). 

“June’s soar tells me a few issues: First, the transition within the freight market from spot again to contract continues. ATA’s tonnage index is dominated by contract freight, so whereas the spot market has slowed as freight softens, contract carriers are backfilling these losses with masses from shippers decreasing spot market publicity,” stated ATA Chief Economist Bob Costello. “Primarily, the market is transitioning again to pre-pandemic shares of contract versus spot market. Second, and maybe equally essential, whereas financial development is predicted to be delicate general within the second quarter, the products economic system wasn’t as dangerous as feared,” he stated.

In distinction, Cass Freight Index declined 2.6% m/m in June and a couple of.3% on a y/y foundation, much like the two.7% y/y decline in Could. Regular seasonality from this index stage would suggest shipments down 1% y/y in Q3 and down 5% y/y in This autumn for 2022. The expenditures part of the Cass Freight Index, which measures the whole quantity spent on freight, rose 8.8% m/m in June to a brand new file, with shipments down 2.6% and charges up 11.7%. It’s estimated that roughly ten share factors of the y/y improve are resulting from gasoline costs alone.

All charges cited under exclude gasoline surcharges except in any other case famous.

In a repeat of final summer time’s occasions in Los Angeles, BNSF Railway and Union Pacific Railroad are metering what number of ocean containers they haul from Los Angeles and Lengthy Seashore ports. In accordance with the JOC, “shippers’ incapacity to retrieve containers from inland ramps and returning chassis quick sufficient to create room for added cargo” is the first trigger for reducing intermodal capability. As was the case final yr, truckload capability tightened as quickly as shippers switched to the truckload sector to maneuver volumes on essential lanes. 

On the high-volume Los Angeles to Chicago, the place round 30% of intermodal strikes happen, dry van spot charges elevated once more final week to a mean of $1.84/mile, which is up $0.17/mile within the earlier month. For context, that’s nonetheless $0.87/mile decrease than final yr. On the Los Angeles to Dallas truckload lane, spot charges are $0.07/mile increased this month at $2.00/mile however nonetheless $1.31/mile decrease than this time final yr. 

Within the Southeast, spot charges in Atlanta proceed to drop following final week’s $0.03/mile lower to a mean outbound price of $2.01/mile. Additional north in Elizabeth, capability continues to tighten, with spot charges up for the fourth week to $1.78/mile following final week’s $0.02/mile improve. Masses from Elizabeth to Chicago have elevated by $0.05/mile to a mean of $1.48/mile within the final month, whereas masses to Atlanta had been additionally up by $0.03/mile to $1.57/mile. 

Finish-of-month delivery volumes elevated dry van load publish volumes by 13%, leading to capability tightening barely. With load publish volumes above a million masses, we’re nonetheless seeing a really wholesome spot market, which is simply 6% decrease than this time in 2020 however down 29% y/y. Because of increased load posts and eight% fewer tools posts final week, the dry van LTR elevated by 22% w/w to 4.05. 

As we predicted final week, falling diesel costs have elevated dry van spot charges by just below a penny-per-mile final week. The nationwide common linehaul price now stands at simply over $1.96/mile. In comparison with the highest 50 lanes for dry van freight, spot charges are nonetheless $0.40/mile increased than the earlier week however $0.06/mile decrease than in 2018, in accordance with information collected by DAT. Dry van linehaul charges are additionally $0.43/mile decrease than the earlier yr however $0.06/mile decrease than in 2018. Dry van linehaul charges excluding gasoline have dropped by over 29% or $0.81/mile YTD however are nonetheless $0.35/mile increased than the typical of pre-pandemic years.

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