July spot market activity dips down from June but is up annually, reports DAT

As has been the case for several months, heavy spot market activity remains prevalent in the freight transportation market, with July turning in another strong performance, according to recent data published by Portland, Oregon-based freight marketplace platform and information provider DAT.

By ·

As has been the case for several months, heavy spot market activity remains prevalent in the freight transportation market, with July turning in another strong performance, according to recent data published by Portland, Oregon-based freight marketplace platform and information provider DAT.

For the month of July, DAT said that the van load-to-truck ratio came in at an average of 3.2 percent, which was down significantly from June––by 26 percent––and was up 23 percent compared to July 2013.

DAT defines load-to-truck ratios as the number of loads posted for every truck posted on DAT load boards, with the ratios serving as a “sensitive, real-time indicator of the balance between spot market demand and capacity.”

While June was a record-setting month, July was not as strong but still impressive. Spot market activity has been well above levels in recent years for various reasons, explained DAT, including: disruptive Q1 weather; an improving economy; seasonal fluctuations of freight and capacity; and shippers relying more on 3PLs to secure freight and meet the needs caused by the growing volume of exception freight.

The average reefer load-to-truck ratio dropped 21 percent to 9.1 from a June seasonal high of 11.5, said DAT, with the annual load-to-truck ratio up 15 percent annually in July. And flatbed load volume in July fell 11 percent compared to June and capacity rose 14 percent, which saw the load-to-truck ratio fall 22 percent. Even with this decline, though, DAT noted that on an annual basis July saw 52 percent more flatbed loads and 19 percent fewer trucks posted, leading to an 88 percent gain annually in the flatbed load-to-truck ratio.

A general consensus for the ongoing strength in the spot market––for both volume and rates––among industry stakeholders is tied directly to the capacity shortage, with larger shippers running routing guides awarding lanes to carriers and brokers when they suddenly cannot get capacity and then needing to turn to brokers in the spot market.

Mike Regan, Chief Relationship Officer at TranzAct Technologies, said in a recent interview that current trends on the spot market are strong, as the DAT data indicates

But he noted the underlying reasons as to why that is the case are not always prescient.

“Some people point to a stronger economy, but it might have more to do with the discipline of the carriers in terms of how they run their equipment and maintain strong pricing,” he said. “More carriers can make more money running fewer trucks, a carrier CEO recently told me. And call-to-haul factors for each piece of equipment are running especially strong and allowing them to maintain discipline on the pricing side. I don’t know if the gains we are seeing are as much a product of demand as they are of pricing.”

When asked if the spot market volume gains and rate momentum can carry over into the second half of the year, Regan noted that remains to be seen.

“The fact that the spot market is this strong at this time of the year tells me things could be slower in the September and October timeframe,” Regan said. “There is also the question if we are seeing a shortening in the cycle of back-to-school shipments and that type of stuff. And many larger carriers are still talking about idling capacity because they cannot find enough drivers. If GDP heads up over 2 percent, people may have a tougher time finding trucks than they already are.”


About the Author

Jeff Berman, Group News Editor
Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

DAT · Spot Market · All Topics
Latest Whitepaper
Reduce Order Processing Costs by 80%
Sales order automation software will seamlessly transform inbound emailed and printed purchase orders into electronic sales orders that can be automatically processed into your ERP system with 100% accuracy.
Download Today!
From the June 2016 Issue
In the wildly unstable ocean cargo carrier arena, three major consortia are fighting for market share, with some players simply hanging on for survival. Meanwhile, shippers may expect deployment shifts as a consequence of the Panama Canal expansion.
WMS Update: What do we need to run a WMS?
Supply Chain Software Convergence: Synchronization Realized
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Optimizing Global Transportation: How NVOCCs Can Use Technology to Operate More Profitably
Global transportation isn't getting any easier to manage, especially for non-vessel operating common carriers (NVOCCs). Faced with uncertainties like surcharges—but needing to remain competitive when bidding against other providers—NVOCCs need the right mix of historical data, data intelligence, and technology support to make quick and effective decisions. During this webcast you'll learn how Bolloré Transport & Logistics was able to streamline its global logistics and automate contract management.
Register Today!
EDITORS' PICKS
Details Key to Cross-border Ease
Ever-changing regulations are making it risky for U.S. companies engaged in cross-border trade...
Digital Reality Check
Just how close are we to the ideal digital supply network? Not as close as we might like to think....

Top 25 ports: West Coast continues to dominate
The Panama Canal expansion is set for late June and may soon be attracting more inbound vessel calls...
Port of Oakland launches smart phone apps for harbor truckers
Innovation uses Bluetooth, GPS to measure how long drivers wait for cargo