Spot and contract truckload activity shows positive signs to end 2024, reports DAT

Spot market trucking activity demand and rates saw gains over the month of December, in advance of the holidays, according to the new edition of the DAT Truckload Volume Index, which issued today by DAT Freight and Analytics.

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.

DAT’s data highlighted the following takeaways for truckload volumes, and rates, for the month of December, including:

• the van TVI, at 260, was up 2.4% compared to November and up 12% annually;
• the refrigerated TVI, at 220, was up 3% compared to November and up 20% annually;
• the flatbed TVI, at 237, was down 5% compared to November and up 7% annually;
• national average spot rates, for each three segments, were up, from November to December, with van up $0.09, at $2.11 per mile ($1.74 net fuel), reefer up $0.02, to $2.47 per mile ($2.06 net fuel), and flatbed up $0.02, to $2.39 ($1.94 net fuel) per mile; and
• national average contract rates were mostly up, with the contract van rate, at $2.42 per mile, up $0.02 sequentially and down $0.06 annually, the reefer rate, at $2.74 per mile, flat sequentially and down $0.13 annually; and the contract flatbed rate, at $3.06 per mile, up $0.03 sequentially and down $0.05 annually

“All told, December volumes were better than expected given the quirks of the calendar,” said Ken Adamo, DAT Chief of Analytics, with Christmas falling on a Wednesday and only three non-holiday weeks between Thanksgiving and the end of the year.  “Across all equipment types, demand helped push spot linehaul rates well above November. Net fuel, the van rate was the highest monthly average since January 2023. The difference between van and reefer spot and contract rates has decreased for four straight months and was the narrowest since March 2022, when spot rates entered a severe deflationary period. When the gap between spot and long-term contract rates is trending lower, it signals that capacity is tightening and negotiating power is shifting toward truckload carriers.”

In an interview with LM, Adamo explained that in looking at the data, December was indicative of what he called a “pretty classic late Thanksgiving December,” where, in past years, there might be more of a lull between Thanksgiving and Christmas, typical of a more traditional Peak Season.

“If you want rates to be high, the calendar was set up about as favorably as it is ever going to for that to happen,” he said. “That is kind of the story. Volumes were pretty good as well, I think, for the first time in what felt like forever but was really probably close to two years. We heard a lot of chatter about carriers leveraging the situation. They have been waiting to have some of that negotiating power back. And I definitely heard, pretty much across the board, they had that.”

As for January, Adamo said things are off to a good start so far, with the expectation that activity will slow down in February.

What’s more, he added that the further peak-related activity can be stretched into late January, it helps to shrink what he called the February and early March lull, in turn, helping to better set up the market over the entire first half of the year. And if the market can go one more week, possibly two, before the bottom falls out on rates, Adamo said rates are only going to probably to fall and equalize for four or five weeks before March starts to give seasonality back.

In looking at 2024 on balance, Adamo said it was “OK,” with the second half of the year showing some promising signs.

“It was a pretty-to-very disappointing first third of the year, and a very surprisingly flat middle third,” he said. “And then I think the last third of the year was optimistic, we were at least starting to see visions of what 2025 could look like. But if you are a carrier, I don’t know that you noticed much difference from January 1-December 31. Maybe there was more optimism at the end of the year, but if you’ve been in the game a while, it is hard to parse optimism from seasonality. Many of the carriers I’ve talked to want to trust—but verify—that the recovery is happening.”