Spot prices to move truckload freight continued their months-long slide in August, despite stronger load volumes, according to DAT Freight & Analytics.
The national average rate to move dry and refrigerated freight on the spot market fell for the seventh consecutive month, according to a Sept. 28 release from DAT, which operates the DAT One load board marketplace as well as the DAT iQ data analytics service.
The spot van rate fell 11 cents to $2.52 per mile in the month, while the reefer rate was down 10 cents to $2.89 per mile, DAT reported. The average spot rate for flatbed freight also tumbled—24 cents to $3.05 per mile in August—and was 40 cents below the all-time high set in March.
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Spot-market rates are negotiated as one-time transactions between freight brokers and carriers, and DAT’s rate analysis is based on $137 billion in annualized freight transactions.
Contract van and reefer rates also decreased last month. The national average shipper-to-broker contract van rate was $3.12 a mile in August, down 8 cents compared to July but much higher than the average spot rate for the month: 59 cents more, in fact.
The average contract reefer rate was $3.40 a mile last month, down 9 cents month-over-month and 51 cents higher than the average spot reefer rate. The average contract rate for flatbed freight slipped 15 cents to $3.66 a mile. The gap between the contract rate and spot rate was 60 cents.
“While spot rates declined and overall load-posting activity was down slightly compared to July, an increase in the number of actual loads moved and a decline in fuel prices were encouraging signs to cap off a sluggish summer,” said Ken Adamo, DAT’s chief of analytics.
Volumes a saving grace for market volatility
The news was better for truckload volumes, as DAT’s Truckload Volume Index (TVI) for van freight was the highest ever, 258 last month, an 11.7% increase compared to July and a 12% increase year-over-year. The reefer TVI increased 8.2% to 184, while the flatbed TVI jumped 12.5% to 251.
DAT’s TVI reflects the change in the number of loads with a pickup date during that month; the actual index number is normalized each month to accommodate any new data sources without distortion. Baseline of 100 equals the number of loads moved in January 2015, as recorded in DAT RateView, a database of rates paid on an average of 3 million loads per month.
DAT national average spot rates are derived from RateView and include only over-the-road lanes with lengths of haul of 250 miles or more. Spot rates represent the payments made to carriers by freight brokers, third-party logistics providers, and other transportation buyers.
Van and reefer load-to-truck ratios held firm in August, DAT said. The national average van load-to-truck ratio was 3.5, down from 3.8 in July, meaning there were 3.5 available loads for every van posted to DAT One. The reefer load-to-truck ratio was 7.1, virtually unchanged from both June and July. The flatbed ratio dropped to 14.1, down from 21.8 in July. The flatbed ratio is in line with August 2019 levels (11.9), when the spot market was oversupplied with capacity, according to DAT.
