Truckers and fleets continued to get good news this week about the sector’s recovery from a nearly three-year long freight recession, as the load board and freight analytics provider DAT Freight & Analytics reported that contract rates for dry van and refrigerated truckload freight posted their largest June-to-July increases on record.
Rates climbed even as freight volumes declined across all three equipment types, highlighting the growing influence of shrinking capacity on pricing. And the volume decline was notable. According to Portland, Oregon-based DAT, freight volumes typically decline in July following seasonal activity in June. However, the June-to-July decrease in reefer volume was the steepest in six years, and the 13% year-over-year decline was the largest among the three equipment types.
Despite that drop in demand, rates were up. DAT defines contract rates as the negotiated prices paid by shippers to asset-based carriers and freight brokers. Including fuel surcharges, national average contract rates increased across all three equipment types in July:
- Dry van: $3.01 per mile, up 12 cents from June
- Reefer: $3.29 per mile, up 7 cents
- Flatbed: $3.83 per mile, up 3 cents
In comparison, spot rates, which DAT says are paid by freight brokers to carriers on a per-transaction basis, were mixed in July. Van and reefer rates moved higher despite declining volumes, while the flatbed rate retreated from its all-time high in June:
- Spot van rate: $3.01 per mile, up 1 cent from June
- Spot reefer rate: $3.42 per mile, up 3 cents
- Spot flatbed rate: $3.64 per mile, down 5 cents
Those numbers showed that van spot and contract rates reached parity; national average van spot and contract linehaul rates were both $2.39 per mile in July. With fuel included, both averaged $3.01 per mile.
“Spot rates moving ahead of contract rates have historically signaled a tightening market, but we haven’t seen a capacity-driven market quite like this one,” said Dean Croke, DAT industry analyst. “Van spot and contract rates reached parity in July even as volumes declined, while van and reefer contract rates posted record June-to-July gains. When rates rise this quickly as volumes fall, it indicates that available capacity is exerting greater influence on pricing.”
