DAT May Truckload Volume index sees some declines

Truckload spot market volume in May picked up where April left off, showing declines for the third consecutive month. That was the main thesis of the new edition of the DAT Truckload Volume Index (TVI), which was issued this week by DAT Freight & Analytics.

The DAT Truckload Volume Index reflects the change in the number of loads with a pickup date during that month, with the actual index number normalized each month to accommodate any new data sources without distortion, with a baseline of 100 equal to the number of loads moved in January 2015. It measures dry van, refrigerated (reefer), and flatbed trucks moved by truckload carriers.

May’s TVI dry van freight reading—at 256—was down 3.7% compared to April (April was down 10% compared to May), with the refrigerated TVI—at 190—also down 3.7%, and the flatbed TVI—at 240—rose 4.8%, for the same period. On an annual basis, DAT said the May TVI was up 10% for van freight, up 11% for reefers, and up 29.7% for flatbed loads. The firm explained that demand for truckload services was strong relative to May 2021, with the total number of loads on the market rising. But it also noted that shippers are seeing better routing guide compliance, with carriers covering more freight under contract than at this time a year ago.

DAT’s data highlighted the following takeaways for truckload volumes, load-to-truck ratios, and rates, for the month of May, including:

• the average rate, for van freight under contract, hit a new high, at $3.29 per mile, topping April’s $3.26 per mile;
• the average contract reefer rate, at $3.56 per mile, also hit a new high, topping April’s $3.43 per mile;
• the average flatbed rate, at $3.84 per mile, also hit a new high, topping April’s $3.79 per mile;
• the national average spot market van rate decreased $0.07, to $2.69 per mile, which was flat annually;
• the national average spot reefer rate, at $3.06, decreased $0.07;
• the national average flatbed rate, at $3.44 per mile, rose $0.03, setting a new record;
• spot load-posting activity saw a 14% increase, from April to May, with seasonal goods, fresh produce, construction materials, and other freight moved through supply chains, said DAT, with truck load posts down 2.3%;
• the national average van load-to-truck ratio rose from 3.4 in April to 4.4 in May, for its second-highest on record for the month of May, with the reefer ratio rising, from 6.3 in April to 7.5 in May, and the flatbed ratio falling from 64.5 in April to 63.3 in May; and
• May surcharges averaged $0.72 a mile for van freight, $0.79 a mile for reefers, and $0.86 a mile for flatbed freight

“Demand for truckload services was solid last month, even on the spot market, where the number of available loads has fallen throughout the year,” said Ken Adamo, DAT chief of analytics, in a statement. “There were more than 1 million dry van loads on the DAT One network during each week in May, which has happened only once, in 2021. However, the price of diesel fuel continued to put downward pressure on spot truckload rates and cause small carriers to be discerning about the loads and terms they accept. We expect this volatility to continue through June.”

DAT Principal Analyst Dean Croke told LM in an interview that the truckload spot market remains very healthy, in terms of the volume of loads being posted. As an example, he explained that there has been only one week this year, in which DAT’s dry van load posts were less than one million loads per week.

“It is still a very healthy market albeit load post volumes in dry van are down 24% year over year,” said Croke. “There is definitely a cooling off but looking at past years, volumes are still really, really strong. And I think the best comparison I have of the market today is that it looks very much like 2018, from a demand point of view. But, from a supply point of view, all of our data points look like 2019, which was an oversupplied market. So, when you look at the individual components of loads and trucks, what you see in dry van is we are almost at where we were in 2018 and 2020, in terms of the volume, but in terms of truck posts there are a lot more trucks posting their equipment for loads this year, because capacity is looser. That is in the spot market.”

What’s more, he observed that those factors are why the load-to-truck ratio is behaving the way it is, adding that the dry van load-to-truck ratio is very close to where it was in 2020, when the market was starting to inch its way out of the pandemic lockdown.

“What we have now is declining spot market rates because the markets are oversupplied with trucks because of just how crazy 2021 was [because capacity was so much tighter]….and we still had record numbers of carriers entering the market,” said Croke.