“Hurricane Harvey is proving that one man’s disaster is another man’s opportunity,” noted Ken Harper with this week’s spot market update, including the charts below. “That probably sounds callous given the massive, heartbreaking destruction, but as we used to say in Vietnam: there it is.”
So let’s talk availability — last week, volumes nationally were down , largely due to Harvey wreaking havoc on the nation’s top market for flatbeds, and the No. 3 and No. 4 market for vans and reefers respectively.
Now that the Port of Houston is operational, and 80 percent of the refineries are back on line, Harper adds, we expect that to change.
An expected shift in supply lines “we’re seeing this week,” Harper says, “as Atlanta, which normally can offload Houston, appears to be the hub for Hurricane Irma preparations from Florida up through the Carolinas and the Southeastern states.” Columbus, Ohio, meanwhile, has taken on more of the burden for freight heading into the Northeast. ”
In terms of supply chain shifts, Columbus, Ohio, a perennial top 10 market, has dramatically increased freight volumes heading to the Northeastern states. These states normally would be served in larger part by Atlanta, which again, is moving freight in advance of Hurricane Irma.
Add the fact that these natural disasters are “coming on top of a robust economy, per a recent report from the Institute of Supply Management,” and for the freight market broadly you’ve got a recipe for potentially continuing good things for truckers.
Hot van markets: The loads that did move out of Houston paid significantly more last week, with outbound average rates up 20 percent. Dallas rates also soared, with prices spiking on many intrastate lanes. The Dallas to Houston lane jumped up from $2.40 to $4.00 per mile for an average. DAT’s never seen anything close to that on this lane, but remember it does remain extremely hard to find a load coming out.
Not so hot: Prices out of Stockton, Calif., showed the least movement, and volumes were off by 14 percent. It isn’t clear how big of a role Harvey played in that, but Northern California has also experienced widespread fires and a heat wave with triple-digit temperatures.
Reefer hot markets: Most of the reefer trends down in Texas mirrored van, with the Dallas to Houston lane average also spiking up to $4.29 per mile. Demand is still high through the Midwest, with big gains on some high-traffic lanes out of Chicago. Reefer rates from Chicago to Atlanta averaged 51 cents above the previous week, rising to $3.58 per mile.
Not so hot: Of the top 72 reefer lanes, only 23 had lower rates last week. Volumes have started to taper in Michigan, and rates from Grand Rapids to Atlanta fell 40 cents. Still, rates continued to rise on the lanes from Grand Rapids to Madison, Wis., and to Cleveland.