Freight for Thought: June market trends favor carriers
The pendulum began to swing in favor of carriers during the 2nd quarter of 2017. Spot truckload freight availability (more freight than trucks) reached its highest point since September 2015 (63% YOY), leading carrier experts to believe the great “freight” recession is behind them.
Shippers, on the other hand, are facing higher prices due to high demand for OTR capacity and increasing tonnage volumes. This trend has been correlated to the U.S. economy improving, according to Cass Freight Index. As a 3PL/broker, Sunset is seeing margin compression for customers with contracted rates but also capitalizing on the open spot market for capacity.
With regular shippers facing inflated costs to move products, and the case for engaging a logistics management program is well-founded. A vast carrier network and negotiated pricing are only just a few of the tools made available to those who work with 3PLs when navigating market shifts.
“Moving forward, brokers will have to be part of the equation for large shippers because we can shift our focus quickly in rapidly changing markets. The agility we can provide is a necessary component in progressive supply chain“, says Mike Fritz, Sunset’s Truckload Carrier Relationship Manager.
Many more shifts in the market are expected during the 2nd half of 2017. Keep an eye on how the ELD implementation will impact capacity, and how many disruptions come into play given the launch of Uber Freight and Amazon’s expansion plans.
Sources: Cass Freight Index, DAT Freight Index
To read more on Sunset’s thoughts on freight-matching services and the disruption anticipated from Uber Freight, read What’s App: What’s App: How Tech Will Meet Truckload in 2017 on the Sunset blog.
Related content: Truckload Rates Climbing; Shippers Should Prepare for Higher Costs