Indicators: Winter conditions stymie freight demand; shippers conditions OK — for now

CCJ’s Indicators rounds up the latest reports on trucking business indicators on rates, freight, equipment, the economy and more.

rateviewdat12815Winter takes its toll on freight: As the major winter storm that impacted much of the country last week hit Friday and Saturday, its impact on last week’s freight demand and rates on the spot market was minimal, says loadboard DAT Solutions. But, ahead of the storm, freight and rates both slowed, with freight demand dropping 10 percent on the spot market last week. The average load-to-truck ratio on the spot market fell from 1.7 to 1.5. Demand could see an upswing this week, however, to make up for lost productivity caused by the impact of Winter Storm Jonas. Rates in the regions most impacted — the East Coast, Midwest and the South — could see a subsequent uptick, too.

oimg1115 Conditions for shippers remains neutral, for now: Market conditions for shippers, based on factors like fuel prices, capacity and truck rates, moved into more positive territory in the last 12 months following small capacity concerns in 2013 and 2014, and the trend continued in November, FTR reported this week. Shippers are enjoying cheaper diesel and better truck capacity, and November’s reading reflects that, says FTR’s Jonathan Starks. Conditions for shippers will likely remain in neutral territory for the rest of this year, Starks says, meaning tougher conditions for carriers to negotiate higher rates. But moving into 2017, as regulatory drag on the trucking industry and tighter capacity begin to set in, shippers conditions could worsen, he says.