April spot market volume hits record levels, says TransCore

Recent data from TransCore noted that April marked the best single month volume output for the spot market, based on its TransCore’s DAT North American Freight Index, which reflects spot market freight availability on its network of load boards in the United States and Canada.

April volumes were up 17 percent year-over-year and up 3.5 percent compared to March, said TransCore.

The firm added that April truckload freight rates saw gains for all spot market categories compared to March. Dry van, flatbed, and reefer rates increased 3.1 percent, 4.9 percent, and 5.5 percent, respectively. And on an annual basis spot market rates for dry vans and flatbeds were up modestly at 0.1 percent and 1.2 percent, respectively, while reefer was down 1.8 percent.

As has been the case in recent months, sequential increases in TransCore’s spot market data match up well with recent data from the Cass Freight Index, which saw April rates up 3.4 percent compared to March and up 5.1 percent compared to April 2011.

Cass officials said that “the impact of moderate contract rates, which shippers negotiated last year when they were expecting significant increases in 2012, has been the dampening of what would otherwise be upwardly moving rates,” adding that “[r]ates on the spot market rose throughout most of March in response to increasing demand and tightening capacity.”

“These numbers are primarily driven by a capacity shortage” said David Schrader, SVP/Operations for TransCore, in a recent interview. “More freight tends to flow into the spot market…to brokerages and 3PLs as the economy tightens. That is what happened in 2011, and it is what we expect to happen in 2012, too. We would expect the same sorts of increases in the spot market going forward. It is a very good time to be in the brokerage space, and what you are seeing is brokerages that are capitalizing on the opportunity.”

And while the growth rate for total revenue and revenue per load were viewed by Schrader as somewhat surprising, he explained that brokers are successfully leveraging the current tight capacity situation and being opportunistic in the market.