Mother Nature is turning the continent's trucking industry upside down.
Volumes on the North American truckload spot market surged in January to levels not seen in years as bad weather across a swath of the nation forced freight into channels where capacity could be found, according to an index published by DAT, a Portland, Ore.-based consultancy. As shippers struggled to secure capacity from their contracted carriers, they turned to the spot market for relief, DAT said.
Spot market volumes rose 24 percent in January over December levels, marking only the second time in the index's 18-year history that January levels exceeded December's. January is typically a quiet month for freight traffic. Year-over-year volumes in January rose 45 percent to levels last seen in October 2005, when pent-up demand following Hurricane Katrina drove volumes to all-time highs.
Dry van freight volumes rose 52 percent over January 2013, DAT said. Refrigerated loads jumped 83 percent and flatbed traffic nearly doubled, according to the study.
Not surprisingly, spot market rates remained elevated in January, although they dipped from December's levels. Compared to January 2013, dry van spot rates last month rose 16 percent, reefer rates rose 4.7 percent, and flatbed rates increased by 4 percent.
There was more of the same in early February. For the week ending Feb. 8, the average spot rate was up 3 cents per mile to $1.97 per mile compared with prior-week levels. The rate included a 1-cent increase in the average fuel surcharge, DAT said.
Dry van volumes increased 15.6 percent for that week, while available capacity fell 8.4 percent. Demand for temperature-controlled units climbed 13.4 percent last week while capacity fell 8.6 percent, DAT said. Demand for flatbed equipment increased 7.1 percent last week, while capacity grew 3.3 percent, according to the consultancy.
The Midwest has suffered the most from the severe winter weather, and truck rates reflect that misery. The average van rate from Chicago jumped week-over-week by 15 cents to $2.30 per mile as the region dealt with extremely low temperatures for the first eight days of the month. Dry van rates out of Columbus, Ohio, were up 9 cents to $2.17 per mile, DAT said.