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 Carrier Sales 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
840,000 Americans applied for first-time unemployment benefits last week, a number that is highly relative to pre-pandemic levels and worse than any week of previous recessions. Jobless claims are down from their peak in the spring, but have remained stagnant since the summer months and refuse to drop further.
Lawmakers haven’t made much progress in working out a compromise for a new stimulus deal, as House Speaker Nancy Pelosi rejected a standalone package for airlines without a larger deal in place. Carriers last week furloughed more than 30,000 workers and anticipate further service cuts if more aid doesn’t come soon.
Reefer rejections continue to climb, just ahead of the protect from freeze season. ROTRI is currently at 44.04 nationally, while some markets are seeing rejection rates in the 60’s and 70’s. With short supply, anticipate rejections to continue to climb in the coming weeks with increased demand and carriers looking to take advantage of the lucrative spot market rates.
As of 8am Friday morning Hurricane Delta (the 25th named storm of 2020 and 9th hurricane) was listed as a high-end Category 3 Hurricane and looking to make landfall over southwestern Louisiana. The hurricane is expected to bring 10-15in of rainfall in parts of the impact zone, with 6 to 12ft storm surges. Significant flash flooding, urban flooding and small stream flooding are expected over the weekend.
What To Expect This Week
FMCSA announced last Friday that they will be holding a session on Oct. 28th to hear petitions on broker transparency. Two of the petitions, from OOIDA and Small Business in Transportation Coalition, seek to strengthen brokers’ reporting requirements, while TIA is looking to eliminate outdated regulations and receive guidance on dispatch services to remove bad actors in the marketplace. We will look for more commentary this week on the announcement.
Both contract and spot rates continue to increase, while shippers are renegotiating their contracts earlier than at previous points. As consumers adjust to the new at-home lifestyle, there is increased consumer spending, which has caused an increase in truckload demand.
Current sentiment is that there will be a double digit rate increased into 2021. With the shift in increased consumer spending and the need to still restock, analysts are expecting import volumes to continue to remain strong well into 20201. As most of the trans-pacific volumes flow through Western US ports anticipate an increase in long haul freight into the market, which will further drive up rates and tighten capacity.
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