Who would have thought that within the house of a 12 months, California would go from a multi-year drought to a collection of atmospheric rivers to devastating flooding, landslides, and inaccessible farmland? Lettuce growers are nearing the top of the season in Yuma, AZ, or what’s referred to as the Winter Salad Bowl, the place 90% of leafy greens are grown over Winter between November and March. Round now, growers sometimes head again to Salinas, CA, to begin summer time manufacturing however not this 12 months, in response to Cody Koehler from A&Z Trucking in Phoenix.
In a latest interview with DAT Freight & Analytics, Cody mentioned, “sometimes, we all the time have a transition week, and it’s known as per week, however it’s normally over a span of two weeks anyplace the second week of April to possibly the final week of April. Throughout this transition interval, we ship a whole lot of break up masses the place a part of the load comes from Salinas and Yuma, some 600 miles aside, which is a good distance between pick-ups for truckers. So this 12 months, we’re anticipating break up loading will final a little bit longer due to the extreme climate in California, which has delayed the beginning of the lettuce season.
In keeping with the USDA, weekly truckload shipments of lettuce in California are up by 9% YTD by the week ending 3/21/23 in comparison with the identical timeframe in 2022. In distinction, Yuma, AZ, lettuce manufacturing is up 15% YTD y/y over the identical timeframe. In years previous, the CA Lettuce quantity actually began to extend within the second week of April, and we’ll be watching to see how the climate has affected that timeline this 12 months.
Market Watch
All charges cited under exclude gas surcharges except in any other case famous.
At $2.03/mile, outbound reefer charges in California are equivalent to 2019 ranges following final week’s $0.03/mile lower. The one reefer market to put up a achieve was in Ontario, the place a three-week slide was reversed following the earlier week’s $0.02/mile improve to an outbound common of $1.87/mile. In Fresno, the most important produce market within the nation, volumes had been up 15% final week after lowering for the prior month. Reefer capability continues to loosen in Fresno, although. At $1.60/mile, charges have dropped by $0.08/mile within the final month. Fresno to Hunts Level, NY, at $1.44/mile, is on par with the February common however the lowest in 12 months. DAT’s Ratescast is forecasting spot charges on the lane to extend by $0.65/mile and peak at $2.09/mile by the point July 4 celebrations roll round.
In Louisana, charges surged final week, rising by $0.41/mile to an outbound common of $2.34/mile. Solely 2021 and 2022 had been greater on the finish of March. Stable positive factors had been reported in New Orleans, the place charges jumped by $0.44/mile to $2.29/mile on 20% greater volumes. Demand was greater on the 500-mile lane to Atlanta, however with enough accessible capability, linehaul charges at $1.93/mile had been the bottom since final November. Within the broader Southeast Area, the place the produce season kicks off in a number of weeks, reefer spot charges at $1.95/mile have elevated by $0.07/mile within the final month.
Load to Truck Ratio (LTR)
Reefer load posts had been simply 12% greater than in 2019 following final week’s 15% w/w lower. Volumes are actually 66% decrease than the earlier 12 months contributing to the 12% w/w lower within the reefer load-to-truck (LTR) drop from 3.15 to 2.77, virtually equivalent to 2019 ranges.
Spot Charges
At $2.00/mile, the nationwide common reefer linehaul price is 29% decrease than the earlier 12 months following final week’s $0.02/mile lower. On DATs High 70 reefer lanes primarily based on the amount of masses moved the earlier week, linehaul charges decreased on 42% of lanes, rising on solely 12% with the steadiness remaining impartial.
