November spot market activity sees traditional seasonal decline, reports DAT

Staying true to seasonal patterns, November spot market volumes saw a 15 percent decline, according to data recently issued by Portland, Oregon-based freight marketplace platform and information provider DAT, a subsidiary of Roper Industries, in its DAT North American Freight Index.

DAT defines the North American Freight Index as a measure of conditions on the spot truckload freight market.

Spot market freight volume in November was down 15 percent compared to October, which DAT said was due to a lower demand for flatbed trucks, which has been the norm every year since in began tracking this data since 1997, with 2012 being the lone exception.

Based on equipment type, van freight availability was off 2.9 percent in November, with flatbed trailers off 30 percent, while reefer volume headed up 9.1 percent. As for spot market rates, vans and reefers were up 0.7 percent and 0.6 percent, respectively, compared to October, with flatbeds down 4.0 percent because of “seasonal pressure,” according to DAT.

Total freight availability in November was nearly halved compared to the record demand seen in November 2014, down 45 percent, with volume down compared to same month level over the last five years, with DAT explaining that strong first half 2015 volumes brought year-to-date volume up and ahead of the same period in all years before 2013.

On the demand side, vans were off 43 percent, and flatbed and reefer were off 53 percent and 41 percent, respectively, on an annual basis. Van and flatbed line haul rates were off 8.6 percent and 7.2 percent, respectively, and reefer rates saw an 11 percent annual dip. DAT said that total rates paid to carriers fell 17 percent, due largely to a 49 percent fuel surcharge drop off that makes up a portion of the rate.

DAT Analyst Mark Montague said earlier this year current spot market spend is within 15 percent of historical norms. And with “disruption” currently absent, these rates are returning to a more normal level, while also carving out a new history in the form of an industrial-led recovery, while also being paced by inroads in the oil and gas sectors, as well as other ones, too.
When asked about the pricing outlook for 2016, Montague stressed it is still too early to come to a conclusion, due to a lack of visibility, which is clouded by ongoing legislative issues in the form of industry regulations, as well as what the winter may bring.

When it comes to the potential harsh impact of regulations on both the sector and pricing, he quipped that “hopefully sanity kicks in and things soften” while noting that is far from a sure thing.

“The best thing to do is to be prepared for all contingencies in 2016, which could be a good growth year or 3 percent or more or a year of flat growth,” he said. “The easiest way to prepare is to have current data handy for a jumping off point.”