DAT data shows early holiday momentum with rising spot rates and falling diesel prices

Data recently issued on the DAT One Network provided to LM by DAT Freight & Analytics highlighted various truckload spot market metrics, for the week of October 19-25.

“Load posts on DAT One rose 2% to 2.26 million last week, while truck posts fell for the second consecutive week, down 5% to 232,703,” the firm said. “National seven-day average spot linehaul van and reefer rates increased, a sign that demand to move goods ahead of Thanksgiving is starting to build. All told, spot rates are higher compared to this time last year. Combined with falling diesel prices, the rate increases are a welcome sign for truckers heading into the holiday season.

The weekly breakdown for van loads, van equipment, load-to-truck ration and linehaul rates for Dry Vans, Reefers (refrigerated), and flatbeds provided by DAT is below:

Dry Vans:

• Van loads: 996,159 up 2% week-over-week;
• Van equipment: 159,906, down 6%; and
• Linehaul rate: $1.72 per mile, up $0.02

Reefers:

• Reefer loads: 548,573, up 9% week-over-week;
• Reefer equipment: 42,521, down 6%; and
• Linehaul rate: $2.10 per mile

Flatbeds:

• Flatbed loads: 720,922, down 3% week over week;
• Flatbed equipment: 30,276, “virtually unchanged, according to DAT; and
• Linehaul rate: $2.07, unchanged

Broker-to-carrier 7-day average spot rates:

• Dry van: $2.08 per mile, up $0.01 cent week-over-week;
• Refrigerated: $2.47 per mile, up $0.02; and
• Flatbed: $2.44 per mile, unchanged

DAT iQ industry analyst Dean Croke said that there are what he called strong signs that ICE (Immigrations and Customs Enforcement) activity at Florida scalehouses are affecting capacity for brokers and reefer load-post volumes, which are up 33% in the last month and 13% over the previous week.

“In Lakeland, the state’s largest refrigerated freight market, reefer load posts surged by 28% last week compared to the week prior,” noted Croke. “There has been a 35% increase in Lakeland loads posted since Florida converted all truck weigh and agricultural inspection stations into checkpoints for immigration status and English Language Proficiency (ELP) assessments on commercial drivers. Despite the produce shipping season being months away, average outbound spot reefer rates in Lakeland have already risen by 10 cents per mile, 3 cents higher than at this time last year.

And he added that the average linehaul van rate on DAT’s top 50 lanes by load volume came in at $2.00 per mile, coming in flat for the second straight week. He explained that in the key 13 Midwest states—that collectively account for 46% of national load volume and sometimes serve as a signal of future national trends, there was a $0.02-cent increase, to $1.95 per mile, topping the national seven-day rolling average by $0.23.

In the September edition of its monthly Truckload Volume Index (TVI), DAT reported while volumes came in lower, spot rates saw slight gains, with DAT Chief of Analytics Ken Adamo observing that September’s upward pricing pressure was not the result of demand, which he said is a trend worth watching in advance of the traditional peak season in October and November. He also observed that freight imbalances and changes in available capacity drove rates higher in certain markets, instead of volumes.

“Rising rates in the face of stagnant volumes are not good,” said Adamo, in an interview. “It is like having inflation without rising wage rates and is a problem. If you're a broker, you have rising rates and no volumes to offset it, because brokers—as we saw during the peak of Covid or during ELD implementation (electronic logging devices)—can live on low percent margins. They make up for that in really, really high volumes. What they can't do is kind of see margins compress. They were already at cycle lows, but seeing them compress and then not have the volume to offset that.”

As for carriers, he explained that some carriers are benefiting, which he described as kind of the rub of lower volumes, but a little-higher rates, in that there is less to go around, but the people that are getting the higher rates are feeling better off than they were a few weeks ago. That comes with the caveat, though, that things will come back down, as the market comes to the reality that there is no real systemic market change underway, he added.

What’s more, he said that this would probably impact backhaul lanes more than head haul lanes, such as the long-haul trunk lanes returning back to major outbound shipping destinations. The reason for that, he surmised, is that in correlating the average rate per mile, in an absolute sense, to the percentage change as a result of it, it is going be a strong negative correlation, in that low-rate per-mile lanes are seeing a bigger percentage increase.