Highlights of Thursday’s SONAR reports are below. For more information on SONAR – the industry’s fastest freight forecasting platform – or to request a demo, click here. Be sure to stop by too the latest SONAR update, TRAC — the most recent industry spot rate data.
Market observation for October 27th:
Charlotte, North Carolina
Foreign demand has continued to slowly recover in the second half of October since hitting its lowest level since February 2021.
Tender volumes leaving Charlotte, North Carolina, fell 17.5% from Sept. 29 to Oct. 11 and have been creeping up since then. Since Oct. 11, the Outbound Tender Volume Index is up 14 points, or 7.5%, to 202.4.
In the Southeast backhaul market, on the other hand, inbound cargo volumes continue to significantly outpace outbound volumes. Inbound volume fell 10% from Oct. 8-13, but the Inbound Tender Volume Index is up more than 15 points, or 6.7%, since then.
The upward movement of volume flows in both directions is driving up rejection rates dramatically. Charlotte’s Outbound Tender Reject Index is up 400 basis points since Oct. 20 as inbound capacity increases and airlines look to the spot market for better rates to book en route out.
Foreign demand is continuing its upward trend that started last Friday after falling to its lowest level since May 2020.
Bidding volumes leaving Harrisburg, Pa. fell 9% from Oct. 3-13 and saw increasing volatility the following week. Just last Friday, the Outbound Tender Volume Index began to recover and has since risen nearly 19 points, or 6%.
Neighboring Allentown, Pennsylvania, market started rising Saturday but has flattened out this week. The Outbound Tender Volume Index in Allentown was up 15 points, or 6.4%, from Saturday through Monday but was flat and is now pointing to a slight downward trend.
Outbound volumes may still be trending up in Harrisburg, but rejection rates are taking a nosedive. The Outbound Tender Reject Index was hovering between 6.7% and 7% earlier this week but is down 63 basis points to 6.1% since Monday. The decline in rejections as volumes continue to rise suggests carriers’ sentiment to honor their contracted freight.
Back in Allentown, rejection rates follow a similar trend. Outgoing volume has been flat for the past few days – and is still flat – and rejection rates are falling. Outbound demand was flat Monday, and that’s when the Allentown Outbound Tender Reject Index really started falling. The index is currently down 70 basis points to 5.5% as shippers accept their contracted cargo for securing.
Foreign demand from Milwaukee is swinging higher after falling to its lowest level since June 2020.
The total volume of outbound tenders in Milwaukee is up 10.7% since Monday, and most of the increase can be attributed to an increase in cooling volume. The Reefer Outbound Tender Volume Index is up nearly 6.5 points, or 22.7%, since Sunday. Meanwhile, van volumes are up just 6% since Monday.
An initial drop in volume earlier this month pushed rejection rates below 4%, but on Oct. 18 they started trending higher and the recent surge in outgoing volume has pushed them even higher. The Outbound Tender Reject Index is up 116 basis points to 5% since Oct. 18. In particular, the boom in reefer volume has boosted reefer rejection rates. They are up as much as 11% this week – the highest level since May – which will put upward pressure on spot rates exiting the market.
“Carrier capacity in Milwaukee will tighten significantly in Q4 as shippers demand a larger proportion of the capacity to support higher seasonal volumes,” said Alex Riemersma, pricing analyst at Ally Logistics. “If this is the case, fares out of Wisconsin will go up, while fares out of Milwaukee should go down.”
NTI as a reference point
The National Truckload Index is a daily look at how spot rates are holding up in specific lanes compared to the national average, giving truckers and brokers an idea of which lanes to lean toward or avoid.
Lane: Milwaukee to Denver (Reefer)
The dry van spot prices in this lane were viewed on Wednesday so let’s take a look at the reefer spot prices.
Milwaukee to Denver spot market reefer prices are up 5 cents since Monday – with a confidence score of 5 – to $3.68 per mile. The rise in spot rates is correlated with the rise in volumes and rejections, and as Milwaukee reject rates continue to rise, these rates will only continue to rise.
Denver is also seeing both volume and rejections rising this week, offering a good chance of booking an outbound batch.
Watch: Carrier update