Spot Rates Move Higher Following Bleak February

Following a dismal February performance, Spring has sprung on the spot freight market, with rates moving higher in all three trucking categories for the first time in several weeks.

The number of available spot market loads gained 12% for the week ending March 5 compared to the previous week, according to DAT Solutions, which operates the DAT network of load boards. Available capacity slipped 1.9%, which helped elevate van, reefer, and flatbed freight rates across the country.

The national average van rate increased 2 cents to $1.56 per mile as the number of van load posts increased 12% and capacity dipped 2% during the week. (All reported rates include fuel surcharges.)

The van load-to-truck ratio rose from 1.4 to 1.6, and hot spots in the U.S. economy boosted small markets like Decatur, Ala., Texarkana, Texas, and Rapid City, S.D., according to DAT.

Reefer load posts picked up 10% and volume was up markedly in big metro areas such as Los Angeles and Dallas. Truck posts fell 2% nationwide, boosting the refrigerated load-to-truck ratio 12% from 2.8 to 3.1. The national average reefer rate increased 1 cent to $1.80 per mile.

Flatbed load volume continued to gain, adding 13%, while capacity declined 4%. The flatbed load-to-truck ratio was up 18% to 14.8, and the national average flatbed rate gained 3 cents to $1.83 per mile.

Goodbye and Good Riddance to February

This latest weekly performance is in sharp contrast to figures for February that showed spot market freight volume fell 7.9% and rates slipped from the month before.

The month-over-month decline was typical of seasonal norms, according to the DAT North American Freight Index.

Freight volume typically rebounds in March, due to an influx of seasonal cargo such as spring fruit and vegetables, construction equipment and materials, and a variety of consumer items.

By equipment type in February, van freight availability dropped 21%, and reefer volume lost 27%, but flatbed trailers added 26%, compared to January. Spot market rates fell 6% for vans, 3.5% for reefers, and 1.2% for flatbeds, month-over-month, not including fuel surcharges.

Compared to February 2015, overall spot market freight availability fell 37%. This continues a 14-month trend of year-over-year declines, due to a combination of tepid freight growth and abundant capacity. Disappointing harvests in California and Florida also contributed to this year's lower volume. 

Demand fell by 44% for both van and reefer trailers, and flatbed freight volume lost 24%, year-over-year. Line haul rates fell 11% for vans, 7.2% for reefers and 7.7% for flatbeds.

Total rates paid by intermediaries to the carrier declined by 18% for vans and 14% for both reefers and flatbeds, compared to February 2015, due to a 55% decline in the fuel surcharge, which comprises a portion of the rate. The surcharge is pegged to the retail cost of diesel fuel, which fell below $2 per gallon in February for the first time since 2004.

The monthly DAT North American Freight Index reflects spot market freight availability on the DAT Network of load boards in the U.S. and Canada.