Freight Insights for Week of March 8
The following insights are taken from a weekly discussion between Sunset’s nine US/MX branches.
Trends and discussions range from seasonal manufacturing and agriculture trends that affect available capacity to general insight into outside factors affecting freight volumes.
Below is a summary of the March 9 call:
FREIGHT VOLUMES & CAPACITY
- Diesel FSC average is at $3.143 this week, jumping up to .07 week-over-week. Projections to go into $4+ by summer.
- Reefer capacity is still tight and spot rates are climbing. Rates are expected to increase for at least 2 more weeks before any type of leveling. With produce season fast approaching, the downward turn is not expected to stay. RPM average hitting records for previous 5 years.
- More dry-van options are coming back into the market, but not fast enough for the increased demand that is swallowing up the excess capacity, with additional need still present. Prices are expected to level in 2 weeks, with no expectation of a downturn.
- Companies are not taking LTL freight and are days behind in pickups/deliveries. Docks are full and there is not enough capacity to keep up.
- Ports and rails are at full capacity and ever growing. Shippers held back the last few weeks in an effort to save money on fees, so volume dropped waiting on ports to clear up. When it ramps back up, it will do so with higher than normal volumes, making the impact even worse than it is now. The slight leveling will lead to worse conditions within the month.
- There has been a heavier shift to cost-plus utilization (truck cost in hand) vs spot to account for large variances in market and carrier rates.
- Storm front coming through the U.S. through next week, with warnings of high winds and flooding issues. Pockets of winter weather are still impacting parts of the country.