Market Update: June 27, 2018

Similar to last week, the market continues to be extremely tight in the Southeast due to a strong produce season. We’re also seeing capacity tighten in the Southwest and Texas with increasing delays getting trucks across the border into the US. We expect the market to continue to tighten in the coming weeks with end-of-month/end-of-quarter orders coupled with the approaching holiday. “As a shipper, being flexible with carriers/drivers will help in these market conditions,” says Brian McIntyre, Director of Operations at Sheer. “Since equipment is hard to come by, you don’t want to limit yourself.”

Spot Market Trends

ELDs Appear to be Working

The FMCSA recently posted an infographic on their website showing a decrease in the percentage of driver inspections with at least one HOS violation.  The sharp decrease comes after the ELD mandate was implemented in December 2017, and further decreases after the enforcement date in April 2018.

Graph: FMCSA

Market Update: June 14, 2018

Spot Market Trends

This June, everyone is feeling the effects of a tight market after Memorial Day weekend and last week’s annual Road Check. Flatbed prices have hit another record high at $2.81/mile and the reefer load to truck ratio rose 57% since last week.

Demand Spikes in Dallas

As the Los Angeles market begins to level out after a delayed produce spike, the freight appears to be moving south as tender rejections are spiking in Dallas. The graph below shows the average tender reject index for the whole United States (blue) versus the tender reject index in Dallas (green).

Market Update: June 7, 2018

Spot Market Trends

Spot market rates are especially high this week as a result of rising fuel costs and a scarcity of trucks exacerbated by this week’s International Roadcheck. According to DAT, “the national averages for both van rates and reefer rates each increased 4¢ per mile, while the national flatbed rate continued to add to its record high, climbing another 2¢ to $2.75 per mile.”

West Coast Capacity Crunch

We’re seeing a large capacity crunch on the West Coast, especially in and around Los Angeles. This is primarily due to a delayed produce season. Tender rejections out of the Los Angeles market rose from below 10% in early May to almost 20% as we entered June.

International Roadcheck: What To Expect and How To Prepare

Across North America, the Commercial Vehicle Safety Alliance’s International Roadcheck will take place June 5-7. Inspectors will be looking over commercial motor vehicles’ mechanical soundness and driver operating requirements. The CVSA will inspect about 17 trucks or buses every minute during this three-day period.

 

This year, inspectors will be conducting North American Standard Level I inspections, a 37-step procedure. This includes:

  • Checking Break Systems
  • Cargo Securement
  • Windshield Wipers
  • Coupling Devices
  • Frames
  • Exhaust Systems
  • Tires
  • Seatbelts

 

During the 2017 roadcheck, of the drivers determined out of service, 32 percent violated hours-of-service rules. So drivers must make sure they have hours-of-service documentation ready, as this will be a focus of the 2018 inspection. This comes following the electronic logging device rule that digitally tracks drivers’ breaks and transporting times, which went into effect in December 2017. The 2018 inspection is the ideal time to see whether the rule has changed drivers’ compliance.

But truckers aren’t the only ones affected by the annual roadcheck.  Shippers should consider ways they can prevent delivery delays during the inspection that could cause service suspensions or generate higher costs for customers.

 

Shippers can prevent headaches by obtaining frequent and accurate tracking updates from transportation providers. Inform your customers that their deliveries could be prolonged due to these inspections. and ask to check their product supply to ensure a delay would not shut down operations in the event of a setback in delivery time.

 

Our customers have been successful in avoiding delays by utilizing dock scheduler tools. This helps shippers track delivery truck arrivals so they can have their products ready to load. If drivers are trying to curb delivery delays, shippers should allow them to arrive early if the facility is managed by appointments. Also, if the shipping facility has plenty of room, drivers should be allowed to park and wait on-site. This provides the shipper with easy access to the truck driver when it’s time to load, and the driver can start transporting goods to the destination as soon as possible.

 

Most importantly, shippers who work by appointment only should allow truck drivers a grace period when it comes to their scheduled appointment times June 5-7. Giving the truck driver an extra hour or so to arrive is helpful when there’s the possibility of being chosen in the CVSA’s inspection.

 

The International Roadcheck will go well as long as everyone is using scheduling tools and communicating effectively. Contact Sheer today to learn about how easy it is to utilize our technology to stay on top of your shipments — even during inspections.

Market Update: May 31, 2018

Memorial Day led to tighter capacity and higher spot market rates as we saw many independent carriers go home for the 3-day-weekend. Flatbed rates rose to another record high while reefer rates are up 2¢ per mile. We’re seeing especially tight reefer capacity coupled with high rates coming out of the South and Southeast due to a booming produce season.

Spot Market Trends

Outbound Tender Reject Index

The graph below shows contracted rates being rejected out of a specified market. Due to the peak produce season, contracted rates are being rejected at a high rate out of Tallahassee, Florida (white line). As the produce boom moves north through Georgia, we can see more rates being rejected out of Atlanta (green line) as rejections subside further south in Miami (orange line).

Market Update: May 24, 2018

Flatbed rates remain off the charts, but the most prevalent story in the market right now is the upcoming Roadcheck, a.k.a. the annual Commercial Vehicle Safety Alliance (CVSA), that will be held in two weeks (June 5th – 7th). During this time, there will be tens of thousands of inspections performed on commercial vehicles. Historically, this disrupts the marketplace due to the lost time during inspections as well as a significantly reduced amount of open capacity as many carriers stay off of the road during the Roadcheck event.

Spot Market Trends

High Flatbed Rates Persist

Market Update: May 17, 2018

With produce season in full swing, we’re seeing tight capacity across the board, especially out the South East. Reefer rates are on the rise due to produce while flatbed rates took a slight dip after record highs due to peak season for construction and building products.

Spot Market Trends

ELD Hits Flatbed the Hardest

In a recent “State of Freight” webinar, Avery Vise, FTR Vice President of Trucking Research, shared the latest data on the recent flatbed capacity crunch.

Several possible reasons are combining to create this situation, he said, both on the demand side and the supply side of the equation. There’s more demand for flatbeds coming from recent strength in manufacturing and construction, as well as recent increases in petroleum prices pushing more domestic production. On the supply side, Vise said, many people think the ELD mandate is hitting flatbed the hardest. This sector includes a lot of owner-operators and small carriers and is typically not the first to adopt new technology, he noted. “There could also be equipment constraints. We saw a sharp increase in flatbed trailer orders starting in September, and that continued until very recently.”.

Market Update: May 9, 2018

Overall capacity remains tight as we head into peak produce season. Heavy hauling and construction freight prices are through the roof as flatbed demand hits a record high of 111 loads per available truck.

Spot Market Trends

Rising Demand for Flatbed Trailers

Skyrocketing demand for flatbed trailers has brought the flatbed load-to-truck ratio to over four times that of 2016, resulting in a rate spike of 7 cents/mile.

Source: DAT.com

Market Update: May 3, 2018

Rates remain steady as April comes to a close, however overall volume is beginning to grow as we see seasonal spikes from produce and construction.

Spot Market Trends

Diesel Fuel Price Trends

Shippers are seeing a hit to their bottom line as their transportation spend increases, partly due to the rising cost of employees. The graph below shows the change in compensation for private transportation and moving material workers. This quarter, costs are up 3.7% from a year earlier. Source: Labor Department

Market Update: April 26, 2018

Van and reefer rates took a slight dip this week while flatbed rates climbed to a new record high. Winter weather in the Northeast and parts of the Midwest have caused a delay in the usually booming produce season. Expect to see an increase in fuel surcharge costs as the recent spike in diesel prices have added approximately $0.10 / mile to truckload rates versus a year ago.

Diesel Fuel Price Trends

Source: Gasbuddy.com