‘A heyday’ for rates on cross-border freight leaving Laredo

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Updated Sep 25, 2020

Demand for goods coming in from Mexico at the Laredo, Texas, border crossing is spurring significant per-mile rate hikes for loads out of Laredo into the rest of the U.S., says a prominent brokerage that works cross-border freight.

Troy Ryley, president of Redwood Logistics’ cross-border freight arm Redwood Mexico, said the company has seen a surge in cross-border freight from its shipper customers in recent months. Outbound from Laredo, those loads often fetch $3-$4 a mile on the spot market, Ryley said. “That’s pretty much unheard of.”

In the mix in this are the same themes I wrote about Wednesday, especially the types of freight. That’s tilted heavily toward kitchen appliances and parts and other home items, much of which is manufactured in Mexico. Another factor is a supply chain trying to reckon with the upheaval COVID and shifting consumer demand have caused. With capacity tight and the spot market absorbing much of the unexpected load volume, rates have shot up.

Ryley acknowledges that, for many truckers, it’s hard to find loads that pay anything to get to Laredo. Cross-border freight into Mexico is much weaker than the volume of freight coming out. Nonetheless, “If they can get to Laredo,” with a load that just covers costs, “there’s plenty of high-paying freight outbound to all parts of the country. Right now, it’s a heyday,” he said.

He expects the trend to continue at least into the first quarter of next year, so long as people continue to stay home more and their spending patterns of recent months don’t change.

DAT Solutions, operator of the DAT One load board, hasn’t seen the same influx in Laredo-outbound loads as Redwood, at least not in recent weeks. For the week ending Sept. 12, dry van load volumes out of Laredo were down 31% week over week, and 17% month over month. That follows a spike in August, though, DAT’s data shows, peaking in the week ending Aug. 29 and dipping since then. Reefer and flatbed loads outbound from Laredo have trended similarly.

On DAT’s board, other Texas cities were hot. Dallas ranked as one of the top markets for outbound loads and dry van and reefer rates. Austin and Forth Worth were also Top 5 performers for flatbed over the last seven days.

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