DAT Truckload Volume Index hits new January highs

The most recent edition of the DAT Truckload Volume Index (TVI), for the month of December, which was recently released by DAT Freight & Analytics, reached new high levels, according to DAT.

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.

January’s reading—at 229—was off 3% compared to December, but it still represented the highest-ever TVI reading in January, while posting a 15% annual increase. DAT said that the number of loads posted to the DAT One load board network saw a 34.7% increase, from December to January, and were up 104.7% annually.

DAT’s data highlighted the following takeaways for truckload volumes, load-to-truck ratios, and rates, for the month of January, including:

the national average spot rate, for van freight, at $3.11 per mile, was up $0.11 over December and saw a $0.99 annual increase;
the average spot reefer rate, at $3.59 per mile, was up $0.12, and increased $0.98 annually, marking the eighth consecutive annual gain;
the national average spot flatbed rate saw a $0.06 cent increase, to $3.14 per mile, marking the ninth straight month above the $3 per gallon mark, and posted a $0.64 annual gain;
the national average van load-to-truck ratio increased from 6.5 in December to 9.3 in January, marking only the second time there has been a December to January increase, with December 2017 (5.1) to January 2018 (6.0) being the other time;
the reefer load-to-truck ratio, at 20.4, was up over December’s 14.0 and January 2021’s 8.2, and the flatbed load-to-truck ratio, at 86.7, easily surpassed December’s 51.1 and also topped January 2021, at 47.9;
the national average shipper-to-broker contract van rate, at $2.98 per mile, was up $0.04 over December, while the average contract reefer rate was off $0.03, to $3.16 a mile, and the average contract rate for flatbed freight was down $0.01, at $3.33 per mile; and
the national average diesel fuel surcharge came in at $0.41 per mile for van freight, marking a seven-year high

“Load-to-truck ratios on the DAT load board network hit record highs for January, a sign of exceptionally strong demand for truckload services,” said Ken Adamo, DAT Chief of Analytics, in a statement. “While the number of loads moved gradually eased throughout the month, tight capacity and disruptions due to winter weather and COVID-19 helped push rates to historic levels.”

When recently asked if a $3 per-mile spot van rate is sustainable, Adamo said that is likely not the case. He compared it to what he called the “100-truck problem.”

“If you assume a fleet has 100 trucks, historically, 12-to-15 of those are running the spot market, and the other 85 or so are running contract freight,” he said. “That is harmony, because the 12%-to-15% running on the spot market might be repositioning, or cancelled loads, or it might be an out of sequence shipment so they come to the spot market. What we saw throughout the year and peaking at the end of the year was maybe 30 or 40 of those trucks being used in the spot market. Carriers would tell you they would love to see it that way forever until the spot market eventually craters back down to $1.50 per mile. They would see that as not sustaining profit margins.”

He explained this represents a two-ended network, and with shippers it is continuing to ratchet up what they are willing to lock in on the contract side. And he said shippers are telling DAT they are seeing success, especially rounding 2021 and into 2022, getting commitments from carriers on the contract side.

“Relative to the 100-truck problem, operating a 30-70 spot-contract [ratio] will slowly switch back, whether it is by the end of the first quarter and contract gets back to the 75-80 range,” he said. “If we are at 85 by the end of the year, that will necessarily ease rates in the spot market.”

When asked about what shippers and brokers need to be focusing on, relative to spot freight, at this point of the year, Adamo said brokers should be trying to get aggressive on contract bids, as they are currently at a point, in a sense, in which they are at the top of a pretty high mountain, as it pertains to rates.

“You know shippers are looking for stability, in terms of service and price,” he said. “They are really willing to trade off what they are paying for stability and are willing to trade volatility for higher price and stability. At the end of the day, I am a little more willing to get aggressive on contracts, whereas last year I would not have been, because I would have missed out on 50%-to-60% price increases.”

On the shipper side, he said they need to be very mindful of the 100-truck problem, thinking about where the market is going to shifts and understanding there is not a need to overcommit to the contract market.

About the Author

Jeff Berman, Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman

packers and movers bangalore
packers and movers bangalore near me
packers and movers bangalore cost
packers and movers bangalore to hyderabad
packers and movers bangalore price
packers and movers bangalore marathahalli
packers and movers bangalore to chennai

The post DAT Truckload Volume Index hits new January highs first appeared on shrisaimovers.

DAT Truckload Volume Index hits new January highs

About the Author

Posted by SHREE SAI PACKER AND MOVERS BANGALORE

You may like these posts