- Spot rates at the beginning of August were almost at their high for 2020, according to a Thursday news release from DAT. The higher rates, for the week ended Sunday, included all the major segments of dry van, reefer and flatbed.
- Truckload capacity usually declines at this point in the year, DAT said, but supply chain disruptions mostly caused by COVID-19 pushed more freight to the spot market. Capacity tightened as shippers and brokers posted an 8.6% increase in loads, week over week, while truck postings fell 8%, DAT reported.
- Load-to-truck ratios increased in all segments, with the van ratio at 5.2 after averaging 4.4 in July. Average reefer ratio was 9, the highest in two years, DAT said. Flatbed ratio was 30.6, ahead of the 2019 average. Van and reefer rates began August higher than July averages, at $2.20 and $2.42 per mile, respectively. Flatbed was up 13 cents to $2.20 per mile.
A citrus fruit volume surge in California, a hurricane along the Southeast coast, and consumer demand and fulfillment were responsible for the increase in loads, DAT said. The data indicate fleets, brokers and independent drivers could be in store for an August with rising load-to-truck ratios in reefer, dry van and flatbed. And it won't always be the pandemic or the economy that gets loads posted.
According to DAT, the Isaias weather system moved more loads out of Florida than normal: Dry van volume out of Lakeland was up 20%, compared to the week before.
And in California, agricultural yields caused spot demand.
"High volumes of citrus fruits and leafy greens led to tighter capacity in Southern California, especially in the Salinas Valley," DAT reported. "Produce volumes for the entire state were up 53% in July compared to June."
In a more pandemic-related movement, load volumes out of the top 10 fulfillment warehouse markets rose 25% in July, DAT said. As millions of Americans are working from home or have been sheltering, imports related to home improvement have been flowing from ports to distribution centers. The Home Depot will add three distribution centers in the Atlanta area to meet growing demand as consumers embrace do-it-yourself projects, the retailer said in a Tuesday morning press release.
Retail household items were also causing more freight to move through distribution centers. Both trends would primarily benefit dry van.
Different lanes showed different demand caused by these factors. DAT said spot van rates from Memphis to Atlanta have jumped 55 cents to $3.11 per mile in the two weeks leading up to Sunday. Flatbed was also high, with a load-to-truck ratio of 30.6, but flatbed trucks move construction equipment and large industrial items, which tend to be needed during summertime work.
The tighter capacity comes as tonnage slowly improves after diving in April. The American Trucking Associations reported on July 21 that for-hire tonnage increased 8.7% in June after falling 1% in May. ATA's chief economist, Bob Costello, said the number was one of the highest in the last seven years.
"Not surprisingly, as more states lifted restrictions in June, truck tonnage was robust," said Costello. "While the gain in June was the single best month since January 2013, the solid gain was not enough to put tonnage back to pre-pandemic levels, but it is close."
Costello said he was concerned tonnage would be hurt later as states reinstate lockdown policies as higher numbers of coronavirus cases are reported. California reinstituted some business shutdowns on July 12 after cases increased.