Economic signals continue to suggest that the truck freight market has finally bottomed out after a two-year period of inventory destocking, excess trucking capacity, and historically low rates, according to a report from FTR.
Specifically, FTR said that June inflation was mild at both the consumer and producer levels, with consumer prices actually declining month-over-month for the first time since May 2020. This was mainly due to falling gasoline and diesel prices. Truck insurance premiums also decreased after more than a year of gains. Additionally, new applications for transportation and warehousing businesses saw their largest increase since August 2022, alongside recent gains in new trucking authorities.
Broker-posted spot rates in the Truckstop system for dry van and refrigerated van equipment recorded rare gains during the week ended July 5 (week 27), although the timing of the Independence Day holiday likely was a factor, FTR said. Rates for both equipment types typically fall sharply during week 27, but most of the week preceded the holiday. In most years, almost all pre-holiday rate strength occurs during week 26. Rate decreases this week are the seasonal expectation.
For the rail carload sector, the week ended July 6 was basically a repeat of the same 2023 week in terms of overall volume although performance differed sharply by commodity group. The intermodal sector, meanwhile, was much stronger than it was in the same week last year. North American intermodal loads were up 16.7% year over year, principally due to a brief port strike in Western Canada last year.
