Subscribe to our free, weekly email newsletter!


TransCore reports October 2011 spot market volumes are up 39 percent annually

By Jeff Berman, Group News Editor
November 16, 2011

October spot market volume saw a 39 percent gain, according to data released this week by TransCore.

Company officials said that this output marked the highest same-month volume since the aftermath of Hurricane Katrina in 2005 and was the highest same month volume since then. On a sequential basis, spot market volume fell 3.7 percent, which TransCore said is in line with typical seasonal patterns.

Truckload freight rates, excluding fuel surcharges, were mixed for all equipment types in October, with national average rates for dry vans up 6.3 percent annually compared to October 2010 and up 1.5 percent compared to September. Reefer rates were up 2.7 percent annually and 2.5 percent compared to September. Flatbed rates were up 12 percent annually and were flat compared to September.

Carriers told LM at this week’s TransComp exhibition in Atlanta that fairly tight capacity is a major factor in driving spot market volumes, although capacity is not as tight as it was as recently as a few months ago.

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 high, and gas prices are about a dollar higher than they were a year ago at this time.

Usually, the spot market rates are about 15 percent lower than contract rates. But this year, according to TransCore’s analysis, on a national average about 24 percent of lanes had spot market rates that were higher than contract rates during the second quarter.
While fairly tight capacity remains a driver for high spot market volumes, it stands to reason that will continue to be the case going forward.

“From an industry-wide perspective, there is a proliferation of freight brokers,” said Stifel Nicolaus analyst John Larkin in a recent interview. “We have not saturated the percentage of the market that can be brokered yet. In addition to CH Robinson being the 800-pond gorilla in this space, you also have all these other companies out there doing it, too. At the same time, most of the asset-based carriers are starting up brokerages. It is a rarity when you see a carrier that does not have a brokerage.”

As long as spot market prices run below contract market prices, Larkin said it will continue to be something shippers leverage.

About the Author

Jeff Berman headshot
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. .(JavaScript must be enabled to view this email address).


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!

Recent Entries

While it feels somewhat hard to fathom, the stage is set for the Council of Supply Chain Management Professionals (CSCMP) Annual Conference in San Antonio, Texas.

Carload volumes were up 1.4 percent at 300,388, and intermodal volume for the week ending September 13 was up 5 percent at 279,052 trailers and containers.

Company says the Cloud offering allows customers to respond more quickly to new business opportunities, without significant upfront cost and implementation times.

As e-commerce continues to take a bigger piece of the holiday package delivery pie, it stands to reason that companies need to be proactive and prepared in order to deliver premium service during the busiest time of year, which is rapidly approaching. And that is exactly what transportation giants UPS and FedEx are doing this year. How are they doing it exactly? The primary step they are taking is to up their numbers of seasonal staffers.

A recent hearing of the Subcommittee on Coast Guard and Maritime Transportation suggests that the U.S. Merchant Marine industry may be poised for a major comeback.

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA