- Truck tonnage shrunk 12.2% in April after increasing 0.4% in March, according to a release from the American Trucking Associations (ATA) on Tuesday. April's decline was the largest in 26 years, when a labor strike occurred in April 1994, said Bob Costello, ATA chief economist.
- Tonnage shrank 11.3% from April 2019, the largest year-over-year decline since early 2009, Costello said. As bad as that is, the year-to-date tonnage compared to the same period in 2019 is down 1.3%.
- But DAT reports load-to-truck ratios on its boards have steadily increased in recent weeks. "We're no longer seeing the massive declines in prices that were across the board in April," wrote Matt Sullivan, DAT analyst, in a Monday blog post.
Spot rates were terrible in April, but analysts said rates were likely scraping the bottom and ready to rebound. The analysis by Sullivan indicates that is likely the case, with truckload capacity shrinking, pushing prices up.
The green shoots in the economy come as warmer weather arrives and as most states allow a gradual reopening of businesses. Sullivan observed that, as the nation looks for economic footing, demand for truckload shipments is picking up. As a result, spot truckload rates are getting healthier, especially in produce regions where harvests are hitting supply chains, he wrote.
According to Odyssey Logistics, produce season is the "first major event on the calendar." Typically, it runs from February through July, as fruits and vegetables get harvested, along with imports from Mexico to the United States. California helps kick it off with big shipments of lettuce and other greens. In March and April, border cities in Texas, such as McAllen and Laredo, are typically hit hardest by the influx of volume, according to Coyote Logistics. Florida is traditionally a "produce hotbed" from Mid-April through the beginning of July, the firm continued.
Under current conditions, refrigerated trucking levels are above normal only on the West Coast for the week ending May 11, FTR found. The West Coast is where much produce begins to move, from the Southwest to other parts of the nation. Overall, FTR expects loadings of food will rise an additional 8% from 2019, to 166.9 million truckloads in 2020.
According to the FTR COVID-19 Truck Recovery Index, which uses data from Truckstop.com, refrigerated origin volume is 30% or more above the normal range for California, Oregon, Washington, Montana, Wyoming, Utah and Idaho. Avery Vise, FTR VP of trucking, said reefer business is uneven for other parts of the nation that produce food. The Great Plains states, Texas, Iowa, Indiana and Illinois are seeing at least 30% less reefer volume.
FTR analysts said the coming recovery will be uneven, both in sectors and in regions. Food and other refrigerated goods are still kings of the recovery, as consumers eat at home more often than in pre-pandemic times.
In FTR's Thursday webinar, analysts said dry van activity, based on origin volumes, has rebounded off an economic bottom but is stuck at low levels "that do not yet indicate a significant return to normal industrial or consumer activity." Flatbed levels are low but stable, FTR officials said. Both trucking segments rely heavily on industrial activity.
Vise said the firm's index shows an overall "bottoming out" of market conditions, which occurred in mid-April, but no sustained acceleration toward trucking recovery.