TransCore reports mixed sequential and annual spot market data for March 2012

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, posted a 40 percent gain in March over February and was down 6.1 percent annually compared to March 2011.

By ·

Spot market conditions for the trucking sector were mixed in March, according to data released by TransCore this week.

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, posted a 40 percent gain in March over February and was down 6.1 percent annually compared to March 2011, which TransCore said was a record month in which the spot market saw record volumes.

March truckload freight rates saw gains for all spot market categories compared to February, according to TransCore. Dry van, flatbed, and reefer rates increased 3.2 percent, 1.2 percent, and 0.7 percent, respectively. And on an annual basis spot market dry van rates dipped 1.5 percent compared to March 2011, with flat bed and reefer rates flat.

The sequential increases in TransCore’s spot market data match up well with recent data from the Cass Freight Index, which found that freight expenditures were up 1.0 percent compared to February and 4.3 percent annually.

The Cass report noted that “[r]ates on the spot market rose throughout most of March in response to increasing demand and tightening capacity,” which appears to be a common theme in the trucking sector since carriers have regained pricing power since the end of the Great Recession.

And as LM has reported, shippers and carriers alike have said that the spot market is still demanding top dollar rates, as carriers are reluctant to add capacity at a time when the economic recovery appears tenuous, retail sales are flat, unemployment is still high, and gas prices remain higher than they were a year ago at this time, although the gap has been closing in recent weeks.

Robert W. Baird & Co. analyst Benjamin Hartford noted in a research note that spot market trends tend to moderate on a seasonal basis, adding that supply and demand dynamics remain relatively balanced into early 2012.

“We expect supply/demand dynamics to remain tight consistent with current expectations for slow demand growth and limited incremental capacity deployment,” wrote Hartford.

Lana Batts, a partner at Transport Capital Partners, recently told LM that when the recession was still intact the freight brokerages operating on the spot market suffered because there was far less available freight and carriers were going wherever they could to get freight. But when the recession was over in February 2011, she said carriers felt they had all the freight and customers they needed and felt they did not need to go back to brokerages.

“Now, they are going back to brokerages because there is a shortage of equipment and they are getting better spot market rates than they are getting out of their contract rates,” she said. “Brokerages tend to do well when there is an imbalance. That imbalance is related to there not being enough freight or not enough trucks.”

The 2009 imbalance was brought on by a lack of freight, due to the recession, whereas the issue less than three years later—through February 2012—has to do with a lack of trucks.


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

spot market · TransCore · Trucking · All Topics
Latest Whitepaper
SaaS Supply Chain Management Systems
A guide to better understanding the market, the software and the benefits
Download Today!
From the November 2016 Issue
The third time is the charm for this U.S. manufacturer on the hunt for a third-party logistics (3PL) provider that could successfully combine transportation services and technology capabilities under one roof.
Warehouse & DC Operations Survey: Ready to confront complexity
2016 Quest for Quality Awards Dinner
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Digital Evolution: Streamlining Logistics and Supply Chain Operations
In this FREE virtual conference we'll define the challenges facing operations and offer solutions designed to create dynamic, automated networks that offer seamless communication, improved collaborative third-party relationships, and the ability to respond to changes at a moment's notice.
Register Today!
EDITORS' PICKS
Logistics Management’s Top Logistics News Stories 2016
From mergers and acquisitions to regulation changes, Logistics Management has compiled the most...
Making the TMS Decision: Ariens Finds Just the Right Fit
The third time is the charm for this U.S. manufacturer on the hunt for a third-party logistics (3PL)...

Motor Carrier Regulations Update: Caught in a Trap
The fed is hitting truckers with a barrage of costly regulations in an era of scant profits....
25th Annual Masters of Logistics
Indecision revolving around three complex supply chain elements—transportation, technology and...