February spot market volumes and rates were mixed, with volumes seeing slight declines, along with pricing gains for some segments it tracks, according to the new edition of the DAT Truckload Volume Index, which was recently released by DAT Freight and Analytics.
The DAT Truckload Volume Index reflects the change in the number of loads with a pickup date during that month, with the actual index number normalized each month to accommodate any new data sources without distortion, with a baseline of 100 equal to the number of loads moved in January 2015. It measures dry van, refrigerated (reefer), and flatbed trucks moved by truckload carriers.
The February Van TVI, at 210, was off 5%, from January to February, with the Reefer TVI, at 173, off 7%, and the Flatbed TVI, at 256, was off 1%—for the same period. DAT said that each segment fell by around 6% annually. DAT explained that van and reefer were down less than expected because of February being a shorter month—suggesting that the daily average freight volume was actually up for the month sequentially.
DAT’s data highlighted the following takeaways for truckload volumes, and rates, for the month of February, including:
- the national average spot van rate was up $0.09 sequentially, to $2.41 per mile and up $0.26 annually;
- the national average spot reefer rate was up $0.07, to $2.88 per mile and up $0.39 annually;
- the national average flatbed rate increased $0.14, to $2.72 per mile and was up $0.28 annually;
- the contract van rate, at $2.52 per mile, was up $0.04 over January and up $0.10 annually;
- the contract reefer rate, at $2.89 per mile, was up $0.08 compared to January and up $0.14 annually; and
- the contract flatbed rate, at $3.13 per mile, was up $0.12 compared to January and up $0.11 annually
Looking at spot rates, the firm explained that winter storms Fern, Gianna, and Ezra disrupted the eastern U.S. throughout February, saying that the terms tightened available truckload capacity while also amplifying gains for spot rates. What’s more, it added that spot van and reefer rates have been heading up since August—with the van and reefer rates in August, at $2.03 per mile and $2.41 per mile, respectively. DAT said that the spread between spot and contract van rates is now at its smallest gap going back to March 2022, which indicates that freight demand and available truck capacity are heading towards balance.
In an interview with LM, DAT Chief of Analytics Ken Adamo observed that the winter storm Fern, which hit at the end of January, and was subsequently followed by a polar vortex over most of the first two weeks of February impacted conditions, with the market still dealing with what he called ripple effects.
As an example, Adamo said that there is more than $3 billion worth of produce impacted in Florida, with reefer volumes down considerably compared to where they should be at this time of year—and reefer rates were contracting prior to the fuel spikes seen in recent weeks related to the Iran conflict.
“Rates are still up [significantly] year-over-year which is a good thing, but the increase in fuel is certainly not doing small carriers any favors,” he said. “Anyone who is on a fuel surcharge program is not having a great time out there right now; that is what the data suggests.”
With diesel prices elevated, Adamo said that this week is likely to represent the low point of the year for dry van and reefer on a linehaul-adjusted basis.
The reason for that, he said, is that shippers are indicating that tender acceptance levels are rising.
“Tender acceptance goes up because for carriers who play in both the spot and contract market, when they’re in the spot market, they’re not getting a fuel recapture generally, and on contract, they are, and so therefore the contract freight becomes much more attractive,” he said. “That is kind of where things are. For small carriers, on an all-in basis, the theoretical linehaul is still up considerably, and they are still in a better spot than they were.
I think the most interesting thing that’s going to happen if [fuel] stays high for a while is how intermodal going to do? Intermodal is the classic fuel savings, and intermodal hasn’t seen this spike that LTL, dry van reefer and flatbed has seen. So, I think what could happen is a little bit counterintuitive, where you do see a little bit of a rush to intermodal save and those rates come up, but still offer a substantial savings, because fuel is so much cheaper with intermodal.”
