Hanjin Woes Boost West Coast Spot Market Truck Freight, Rates
As the West Coast feels ripple effects from the bankruptcy of Hanjin Shipping Co., nationally the number of loads on the spot truckload freight market fell 5% during the week ending Sept. 24 compared to the week before as truck capacity increased 3%, according to DAT Solutions, its network of load boards.
Evan Lockridge・Former Business Contributing Editor
September 28, 2016
3 min to read
As the West Coast feels ripple effects from the bankruptcy of Hanjin Shipping Co., nationally the number of load on the spot truckload freight market fell 5% during the week ending Sept. 24 compared to the week before as truck capacity increased 3%, according to DAT Solutions, its network of load boards.
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Those conditions helped send average van and refrigerated load-to-truck ratios down 10% last week with vans at 2.8 available load per posted truck and reefers at 5.5 to 1. The flatbed load-to-truck ratio was 13.2 to 1, unchanged from the previous week.
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The ratios are back on par with August levels, according to DAT, but spot truckload rates didn’t move much with flatbeds down 1 cent from the week before, for a national average of $1.88 per mile. Vans and reefers were unchanged at an average of $1.64 per mile and $1.91 per mile, respectively. All reported include fuel surcharges.
In contrast, Los Angeles jumped to the second highest spot for the market with the most available outbound loads, behind Chicago. Spot van freight volume and rates surged there last week, up 2 cents to $2.01 per mile. Los Angeles-Phoenix, increased 4 cents to $2.61 per mile, the highest outbound rate, as rates on eastbound, long-haul lanes market made greater gains compared to the previous week.
According to DAT Analyst Peggy Dorf, the bankruptcy of the world’s seven largest commercial shipping company started a ripple effect on the whole supply chain, which includes trucking.
"Even if they didn’t have cargo on Hanjin ships, big retailers are starting to shift inventory from West Coast distribution centers to other distribution centers farther east,” she wrote in the DAT blog. “October is a critical month for retail freight in advance of the Christmas season, and retailers want to prevent stock-outs while they wait for Asian imports to clear through congested docks and warehouses on the West Coast. Those eastbound freight moves will become more urgent, and rates are likely to rise further, as Black Friday draws closer.”
Meantime, several van lanes showed strength last week while two Los Angeles-inbound lanes created opportunities for carriers looking to position trucks in that market:
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Columbus-Buffalo, $2.75 per mile, up 6 cents
Atlanta-Lakeland, Fla., $2.37 per mile, unchanged
Philadelphia-Boston, $3.15 per mile, down 3 cents
Chicago-Los Angeles, $1.29 per mile, up 9 cents
Dallas-Los Angeles, $1.08 per mile, up 2 cents
Spot reefer prices were higher in the Los Angeles market, where the average outbound rate was up a penny to $2.36 per mile. The highest-paying reefer lane in the West was Ontario, California-Phoenix, up 2 cents to $2.90 per mile.
In the refrigerated market, Twin Falls, Idaho, held onto the top spot last week for available reefer loads, due in part to strong potato harvests. The average Twin Falls-Chicago rate was up 24 cents to $1.89 per mile. Midwest reefer rates were mostly down, but Green Bay-Minneapolis paid 20 cents better last week at $2.10 per mile.
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