Fleet Management

Spot Market Truckload Rates Continue to Fall

February 17, 2016

By Evan Lockridge

SHARING TOOLS        | Print Subscribe

Spot-market load availability moved a little higher last week, but it was not enough to outweigh a gain in truck capacity with rates continuing to fall.

According to a report from DAT Solutions, based on its network of load boards, an 0.8% increase in freight for the week ending Feb. 13 came as truck capacity grew by 1.2%.

With the national average diesel price falling below $2 per gallon, truckload rates on the spot market continued their downward trend. Freight brokers usually quote a one-time price that includes both a line-haul portion and the fuel surcharge, so declining fuel prices influence spot market rates significantly, according to DAT.

The number of van load posts dropped by 6% last week, while truck posts were 1% higher than the previous week. The van load-to-truck ratio fell 6%, resulting in 1.3 van loads for every truck posted on the DAT network. The national average van rate dropped 4 cents last week to $1.58 per mile. All rates include fuel surcharges.

Reefer load volume fell 7% and truck posts rose 3% last week. As a result, the reefer load-to-truck ratio fell 9% to 3.1 loads per truck. The national average reefer rate held steady at $1.85 per mile.

Flatbed load volume was up 10% while capacity increased less than 1%. Despite a 10% increase in the flatbed load-to-truck ratio to 9.6 loads per truck, the national average flatbed rate fell 2 cents last week to $1.83 per mile.

Weaker Rates Begin The Year

Meantime, new figures out for January indicate last week's performance is part of a trend, with spot market freight volume declining 9.1% for the month, while truckload line haul rates edged down compared to December.

The month-over-month decline was typical of seasonal norms, according to the DAT North American Freight Index. January freight availability increased in only three of the past 20 years – 2010, 2013 and 2014.

By equipment type, van freight availability fell 15% and refrigerated volume dropped by 8.9%, but flatbed trailer availability gained 6.1%, compared to December. Spot market rates dropped 1.3% for vans, 1.1% for reefers, and 0.6% for flatbeds, month-over-month, not including fuel surcharges.

Compared to January 2015, overall spot market freight availability fell 35%. This continues a 13-month trend of year-over-year declines, due to a combination of tepid freight growth and abundant capacity, according to DAT.

Van demand was down 32%, reefer volume fell 37% and flatbed freight availability lost 42%, year-over-year. Line haul rates dropped 7.4% for vans, 7.9% for reefers and 8.1% for flatbeds, year-over-year.

Total rates paid to the carrier fell by 14% compared to January 2015, due to a 49% decline in the fuel surcharge, which comprises a portion of the rate.

The Journal of Commerce reports that lower spot market rates are prompting some shippers to press for lower contract rates. "According to BB&T Capital Markets, some shippers are pulling down rates in contract talks by turning to third-party logistics providers, while rethinking how they ship lane by lane," JOC notes, as "declining sales and 'zero-budgeting' mandates put more pressure on logistics managers to lower or contain rates."

Comment On This Story

Name:  
Email:  
Comment: (Maximum 2000 characters)  
Leave this field empty:
* Please note that every comment is moderated.

Newsletter

We offer e-newsletters that deliver targeted news and information for the entire fleet industry.

GotQuestions?
sponsored by
sponsor logo

ELDs and Telematics

Scott Sutarik from Geotab will answer your questions and challenges

View All
GotQuestions?

Sleeper Cab Power

Steve Carlson from Xantrex will answer your questions and challenges

View All