The August edition of the DAT Truckload Volume Index (TVI), which was recently issued by DAT Freight & Analytics, was a mixed bag, in terms of rates and volumes.
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, load-to-truck ratios, and rates, for the month of August, including:
“At 48 cents, the gap between our benchmark spot and contract van rates was the least it’s been since April 2022,” said Ken Adamo, DAT Chief of Analytics, in a statement. “We expect the pricing difference to narrow further, with contract rates falling over the next 12 months and spot rates increasing. In the near term, the fourth quarter will be a busy time for freight. It’s important to come into the months ahead armed with pricing data and strategies you trust.”
In an interview with LM, Adamo said that the August TVI data represents slow market conditions overall.
“When we look back at August, we did not see a ton of movement,” he said. “It is shaping up very much like 2019. Those two years have largely converged, in terms of shape and level, and I think that’s going to be kind of the story for the balance of the year. Fuel prices are not helping, nor is the UAW labor situation.”
When asked if rates are likely to remain at or around current levels, Adamo said that is likely, noting that when the fuel surcharge is excluded, current rates are in line with 2018 levels, with 2018 being a very strong year for freight activity, while fuel prices were lower then.
“When you strip out fuel, that was when the rates hit the floor,” he observed. “I think in a lot of ways that kind of like summarizes exactly where we are in the market. And if demand for diesel claws back, that could cause a false-positive, in that a declining fuel market would inflate base rates in the short-term. If you look at what a shipper is paying right now, the highest fuel rates are coming out of the fuel surcharge. For them, the rates are higher than they’d like, given the current supply and demand economics. And for a carrier, they are bringing the revenue in but they are putting it all in the pump for diesel, so it is a bit of a tricky situation.”