Trucking: Truckload spot market in June has a record month, says TransCore
July 18, 2011
Spot market truckload volumes in June were the second-highest ever recorded in 2011 and in the 15 years they have been tracked by TransCore, the company recently reported.
June came in second on both fronts only to March 2011 and compared to May it was up 15 percent and up 37 percent annually. The firm added that June is the sixth straight month that spot market truckload volumes have topped its five-year historical comparison.
These impressive volumes are not altogether surprising, given the ongoing tight capacity situation in the truckload market although anecdotal reports indicate that capacity is not as tight as in recent months.
A research note from Wolfe Trahan analyst Ed Wolfe cited a shipper saying capacity was particularly tight during March and early April, but has seemed to have “loosened up” and spot rates have flattened out sequentially from March to April levels, with rates up about ten percent annually, in line with Transplace data.
Shippers and carriers alike have told LM in recent weeks that the spot market is still attracting 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.
“Carriers today are not interested in adding capacity, because rates today are about equal to what they were in 2006,” said Lana Batts, a partner at Transport Capital Partners, in a recent interview. “The price of a truck has gone up from $80,000 to $120,000 and fuel is up, too. Everything is more expensive, and the industry is still charging 2006 rates. It is not sustainable. Trucking is not as easy of a business to get into as it was before.”
TransCore also reported that truckload freight rates increased on a seasonal basis in June for all equipment types, with the national average rate up 4.5 percent in June for dry vans compared to May and up 3.8 percent compared to June 2010. The firm said that rates for reefer vans were up 5.6 percent in June compared to May and up 4.9 percent annually. Flatbed rates saw a 0.6 percent gain in June and a 7.4 percent increase annually.
Subscribe to Logistics Management magazine
entire logistics operation. Start your FREE subscription today!