The highlights from Friday’s SONAR reports are below. For more information on SONAR — the fastest freight-forecasting platform in the industry — or to request a demo, click here. Also, be sure to check out the latest SONAR update, TRAC — the freshest spot rate data in the industry.
Overview: Spot rates are likely to rise because the Headhaul Index increased 10% w/w.
Highlights:
What does this mean for you?
Brokers: The large increase in volume through the Port of Savannah is likely to continue putting pressure on capacity just as the harvest season arrives. With volumes increasing out of Europe to the East Coast, Savannah is likely to continue this trend in the weeks ahead. Get your loads tendered out further in advance and notify your team that they will likely need to price freight higher coming out of this market.
Carriers: Stay firm on your rates, as we are likely to see the 10% increase in the Headhaul Index cause capacity to tighten even further in the days ahead. Outbound tender rejections are already up 165 bps w/w, so if they rise even higher, the upward pressure should increase on spot rates.
Shippers: Your shipper cohorts currently have tender lead times at 2.4 days, signaling that many shippers are not likely anticipating a tightening of capacity in the days ahead. Outbound volumes may have been slower to increase than expected due to the increased import volumes that have arrived through the Port of Savannah; however, it would be wise to push your lead times to between three and 3.5 days.
Overview: Intermodal volume has reached its highest level since September.
Highlights:
What does this mean for you?
Brokers: Highway capacity is fairly loose in Vancouver, but you will likely find that some carriers are reluctant to head all the way to Toronto, especially since the market has shown signs of easing lately. When negotiating with carriers, stress that forward-looking SONAR indices, such as the Toronto Van Headhaul Index and the Toronto Outbound Tender Volume Index show signs that the market will likely experience some tightening in the coming days.
Carriers: Other carriers have become more reluctant to head to Toronto lately because the market has shown signs of softening. However, a surge in Toronto outbound tenders the past couple of days suggests that the recent easing of capacity in Toronto is likely to be temporary and the market could be tighter by the time you arrive in Toronto.
Shippers: In a lane dominated by international intermodal, the recent pickup in intermodal volume suggests that railway fluidity has improved. For loads that are too time sensitive to move by intermodal (perhaps due to delays on the ocean), keep lead times extended given the still-high Toronto van inbound tender rejection rate of 20.8%.
Overview: Capacity is loosening in Elizabeth, but outbound tender lead times are rising.
Highlights:
What does this mean for you?
Brokers: Richmond’s market is volatile, with volumes constantly swinging drastically within a week’s time. Watch the outbound rejection rates and when those start to fall, use it as an indicator that spot rates will go down. Take advantage of this lull and book before it swings back up to $5.50.
Carriers: Capacity is loosening in both markets. Load balance is pretty tight in both markets but both markets have numerous outbound loads. If trucks are headed into those markets, it shouldn’t be a problem getting out. Since Richmond varies so much, stay firm on your rates to make sure you don’t miss the upswing.
Shippers: Outbound tender lead times are both firmly about 2.5 days and under three and use that as a minimum. With rate swings happening frequently (albeit smaller swings at the moment), it’s important to keep tender lead times further out so that freight spend doesn’t run wild this early in the year.
Source: freightwaves - SONAR sightings for March 25: Vancouver to Toronto, shipper update, more
Editor: FreightWaves Staff