This is a weekly series that brings the insights we use to get your shipments from A to B from our carrier sales floor to your home office.
This week Loadsmart’s Capacity Solutions Manager, Jimmy Fahey, breaks down what happened last week and what to expect this week in the freight market in less than 60 seconds.
What We Saw Last Week
- Truckstop AVG Linehaul decreased slightly, dropping a penny to $3.31 for van, while reefer decreased $0.04 to $3.86. Volumes and rejections remained strong though.
- The average OTRI trended down slightly to 26.53%, indicating spot rates are still significantly higher than contracted rates.
- Expect rates to continue to remain elevated as demand is still extremely high, while there are winter storms hitting parts of the Midwest, arguably the hottest region at the moment.
What To Expect This Week
- Reefer OTRI continues to rise and is sitting at over 50% at the moment. Expect ROTRI to continue gaining momentum, particularly with colder temperatures hitting parts of the US, as well as the looming produce season.
- For carriers, there are multiple lanes out there for well over $4/mi, while some markets are also showing $6/mi.
- The Labor Dept. released their report a day after Congress approved the $1.9 trillion relief package. The report showed initial jobless claims remain elevated at 712,000, shaking off a surge in the last week of February caused in part by the winter storms in Texas. In addition to state claims, there were 478,000 new claims for Pandemic Unemployment Assistance, a federal program for those who do not routinely qualify for state benefits, an increase of 42,000
- The 3rd round of stimulus checks will be going out to many Americans this week, as well as tax returns. As with previous rounds of stimulus, experts expect much of this money to flow into retail. Coupled with the end of month, end of quarter, and the looming produce season, we could see a gradual tightening in the coming weeks.
- With the large amount of TEUs still being produced at origin in China via the Outbound Ocean TEUs Volumes Index (OOTI.CHNUSA), for the week ahead we can expect the massive import volumes to continue pouring into the major ports throughout the U.S.
- With over 50 vessels at anchor waiting to unload across both U.S. coasts, the backlog of freight is likely to continue putting pressure capacity, and thus, container rates in the spot market.
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