Hurricane Florence has made landfall this morning rocking the Carolina coastlines. Capacity in the Southeast region has already tightened significantly, and with disaster relief (FEMA) on the horizon, capacity in other regions will start to tighten as well. Retail Peak season is in full swing causing tighter capacity and we expect that trend to continue through the end of year past the holidays. The biggest areas of concern right now are North Carolina, South Carolina, and the surrounding states due to Hurricane Florence.
Market Effects of Hurricane Florence
“Looking at the inbound tender market share (ITMS) values in North Carolina, there are already anomalous decreases in load volumes moving into the area that is forecast to have the largest rain.” – Freight Waves
“Charlotte’s volume has jumped over the past 2 days with outbound tender market share (OTMS) jumping from 1.7% to 1.81%. Many shippers will try to get freight out in front of the storm as they know they will not have capacity in the market nor do they want freight sitting in the warehouse.” – Freight Waves
Retail peak season has begun and will continue through the end of the year, causing capacity to tighten in all areas. Tropical Storm Gordon made landfall on Wednesday which will decrease capacity and inflate rates in the Southern regions, but will have a ripple effect to surrounding regions as well. With Retail peak season and the continued weather issues, we expect overall capacity to tighten in the next month or so and continue through the remainder of the year.
What an Autonomous Truck Port Could Look Like
With self-driving trucks, the future of trucking could feature autonomous truck ports where human drivers would bring loads to autonomous trucks that would take them across the country. This could have a serious impact on drivers in the less-than-truckload sector. Image via Driverless Report.
As we near September, we’re starting to see the annual retail surge, particularly on the West Coast, but we expect it to start affecting capacity in all regions soon. Capacity is going to tighten significantly for the upcoming Labor Day holiday. That coupled with the retail surge, we expect capacity to remain tighter for the rest of the year.
A Volatile Reefer Market
From FreightWaves – “Since the beginning of the year, the reefer tender rejection index for Houston (RTRI.HOU) shows dramatic increases and decreases in an almost predictable pattern. The overall reefer tender rejection has decreased significantly year to date, falling from a high of nearly 60% in the first quarter to a much more agreeable 33% in August. While this decrease in rejection rates over time would lead one to believe the market has stabilized, rejection rates are volatile each month in an observable pattern.”
As the summer freight boom declines, so are truckload rates across all modes. However, market conditions are starting to tighten in the Midwest region. We are expecting with the Labor Day holiday and the retail surge starting in the upcoming month that capacity will continue to tighten in all regions of the country.
Rates Drop Seasonally, but Volumes Increase
As e-commerce and the global economy continue to expand, supply chains everywhere feel the strain. According to the Institute of Supply Management, manufacturing activity grew again in February, marking the sector’s 18th consecutive month of growth. The institute also revealed that the overall economy has grown for 105 consecutive months since the recession of the […]