Shippers fear “double-digit,” by percentage, rate increases loom in the coming months as trucking capacity continues to tighten and spot market freight activity — and rates — continue to gain ground. Spot market rates have soared in recent months, and the contract market could be next, says FTR analyst and Chief Operating Officer Jonathan Starks.
“Spot market rates are a leading indicator. And, although there is a lag, contract markets are starting to follow suit. Shippers are now taking notice and are getting worried about dealing with double-digit rate increases as we head towards bid season,” he says.
These notes come from FTR’s monthly Trucking Conditions Index report. The most recent TCI is from August, which shows modestly positive conditions for carriers. August’s reading isn’t “wholly reflective of the current environment for truckers,” FTR notes, because it doesn’t include the supply chain disruptions caused in September by hurricanes Harvey or Irma, nor does it fully reflect the ballooning spot market.
“The truck market is currently in the middle of a significant change in conditions,” Starks says. “While the recent weather events made it feel like it happened all at once, spot markets have actually been moving in this direction for the past year. Load activity was rising, truck availability was falling, and rates were already up 20 percent year over year before the storms hit.”
Loadboard DAT Solutions last week reported strong spot market gains in September from August and record-setting year-over-year growth.
Available loads on DAT’s loadboard were 74 percent higher than the same month last year, DAT reported.
The dry van segment in particular saw major gains, with freight activity climbing 15 percent from August and up 80 percent from September 2016. Rates, meanwhile, gained 19 cents a mile from August and were up 35 cents from last September, DAT reported. The load-to-truck ratio hit 6.6 to 1 — the highest average in 8 years.
Reefer demand grew 4 percent from August and 70 percent from last September, pushing rates up 15 cents from August. DAT says harvest season in the pacific northwest and upper midwest, as well as late harvests in California, drove the segment’s surge.
The number of flatbed loads grew 3 percent from August. Though flatbed freight activity typically declines in September, recovery and rebuilding efforts in storm-stricken areas helped boost the segment this year, DAT says. Rates in the segment climbed 8 cents in September.
DAT says it expects the elevated spot market activity to continue at least until February.
By: AJOT | Aug 17 2017 at 09:27 AM | Intermodal | Transport Intermediaries
Acquisition adds network depth and greater service capabilities
Randolph, Massachusetts – RoadOne IntermodaLogistics, a leading single source intermodal, distribution, and logistics service company, announces today the acquisition of UGL, United Global Logistics, Inc., to strengthen its Midwest service offerings and overall North American network. Jerry Chey, owner and UGL president, and his team will continue to run the UGL business as a separate, independent division within RoadOne IntermodaLogistics under Jerry’s leadership. There will be no change to services and operations.
As part of the UGL agreement, RoadOne will integrate the Boomerang division of UGL, based in Dayton, Ohio, into its portfolio of companies. Boomerang is a strong operation serving the regional markets of Ohio and Kentucky and has a full service container terminal and CFS station on site.
Both Roadone and UGL leadership teams are anticipating that significant synergies will be gained with the combination of these entities including: expanded capacity, customer service improvements, stronger technology and an overall expanded service offering.
UGL will have access to and the benefit of RoadOne’s strong fuel, truck and insurance purchasing capabilities, as well as to RoadOne’s full, end-to-end technology platform. The RoadOne Web-based technology platform includes: full end-to-end visibility with Container Intelligence Tracker; real time driver updates that integrate weather and traffic with RoadTrak and systematized route optimization. In addition, RoadOne vehicles are all equipped with ELD’s (electronic logging devices) and driver support systems ahead of the December 2017 deadline.
UGL is located 27 miles northwest of downtown Chicago and is close to O’Hare International Airport, major expressways and rail transportation. The UGL service portfolio includes:
- Local pick-up and delivery including airport transfer
- Over 150 trucks in operation – container deliveries throughout the Midwest, as well as expedited airfreight services at O’Hare
- Intermodal delivery including from Chicago inland rail terminals
- Full trailer to all Midwest areas
- A fully bonded warehouse and 4 container storage yards located in Joliet, Itasca, Harvey, and Rochelle, Illinois
“I am very thankful for the opportunity to join the RoadOne team so UGL can now offer our clients a national service. We look forward to continuing to service our loyal customers under the RoadOne umbrella and believe this will provide an exciting future for all parties involved,” said Jerry Chey, President, United Global Logistics, Inc.
“We’re excited to add depth and reach in the Midwest and specifically Chicago, a major population center and transportation hub for global and national freight movements. With the addition of UGL, guided by Jerry Chey, we’re enhancing the distribution and logistics options for customers and delivering a more comprehensive service network,” said Ken Kellaway, CEO of RoadOne IntermodaLogistics.
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