• ITVI.USA
    15,707.730
    81.870
    0.5%
  • OTRI.USA
    23.490
    0.230
    1%
  • OTVI.USA
    15,707.910
    79.950
    0.5%
  • TLT.USA
    2.800
    0.010
    0.4%
  • TSTOPVRPM.ATLPHL
    3.390
    -0.060
    -1.7%
  • TSTOPVRPM.CHIATL
    2.840
    -0.080
    -2.7%
  • TSTOPVRPM.DALLAX
    1.510
    -0.070
    -4.4%
  • TSTOPVRPM.LAXDAL
    3.290
    0.080
    2.5%
  • TSTOPVRPM.PHLCHI
    1.980
    -0.060
    -2.9%
  • TSTOPVRPM.LAXSEA
    3.900
    0.100
    2.6%
  • WAIT.USA
    124.000
    -3.000
    -2.4%
  • ITVI.USA
    15,707.730
    81.870
    0.5%
  • OTRI.USA
    23.490
    0.230
    1%
  • OTVI.USA
    15,707.910
    79.950
    0.5%
  • TLT.USA
    2.800
    0.010
    0.4%
  • TSTOPVRPM.ATLPHL
    3.390
    -0.060
    -1.7%
  • TSTOPVRPM.CHIATL
    2.840
    -0.080
    -2.7%
  • TSTOPVRPM.DALLAX
    1.510
    -0.070
    -4.4%
  • TSTOPVRPM.LAXDAL
    3.290
    0.080
    2.5%
  • TSTOPVRPM.PHLCHI
    1.980
    -0.060
    -2.9%
  • TSTOPVRPM.LAXSEA
    3.900
    0.100
    2.6%
  • WAIT.USA
    124.000
    -3.000
    -2.4%
Inside SONAR

FreightWaves SONAR releases Capacity Trend Indices

New capacity trend indexes consolidate data points for quicker analysis

FreightWaves SONAR is releasing a new set of indices whose sole function is to help shippers, carriers and brokers prioritize their attention each day – Capacity Trend Market Scores (CTSCV, CTSCR, CTSSV, CTSSR) and Capacity Trend Market Direction (CTDV, CTDR). SONAR subscribers will easily be able to see those markets have the most significant tightening or easing conditions, leading to lower costs and improved profitability. 

Measuring capacity is a key to maximizing margins/transactions for a broker, utilization for a carrier, and minimizing service and budgetary failures for shippers.The capacity trend indices show you which markets are tightening or loosening the most by combining tender rejection rates and market balance of inbound and outbound loads. 

The market score allows users to easily compare capacity conditions across multiple markets while market direction indicates how quickly capacity is loosening or tightening. Instead of looking at multiple values and comparing markets, subscribers now can look at just one.  

Capacity Trend Market Scores

Capacity Trend Market Scores are divided into two perspectives – shipper/broker and carrier. They are positioned on a scale from 1-100 and have values measuring van and refrigerated (reefer) capacity. The higher values represent more favorable trends. 

For instance, Atlanta has a current shipper trend score of 32 after being at 57 a month ago. This is an indication that the Atlanta market’s capacity is trending much tighter than it was a month ago. Tightening markets are unfavorable from a shipping perspective because it means a higher risk of service failures, low compliance and higher rates.  

However, tightening is favorable to carriers, since their services will be in higher demand, leading to higher chances for utilization and shippers may bid up the rates, leading to higher margins. For this reason, the Carrier Trend Market Scores move inversely to the shipper perspective. Targeting markets with tightening capacity increase odds of continued utilization; carriers will find increased spot load activity or markets where new customers may be looking for additional carrier options. 

From a brokerage perspective, identifying where markets are tightening in relation to each other is extremely important – brokers can use these SONAR tools to know which loads they need to focus on and secure capacity for them first. Sorting the market scores from low to high will tell a broker which loads will be the most difficult to cover. In the example above, El Paso has the lowest score, meaning that market is showing the most unfavorable or deteriorating capacity conditions in the country. Lakeland, however, has a score of 100, indicating favorable or improving capacity conditions.    

Capacity Trend Market Direction

The Capacity Trend Market Direction Index is only divided into van and reefer granularities at a market level and ranges on a scale from 3 to -3. Positive values indicate easing capacity conditions while negative scores indicate tightening capacity. The level of positive and negative score indicates the velocity or strength of that change. 

In the example above, the El Paso market has increasing outbound tender volumes, decreasing inbound tender volumes, and sharply increasing outbound rejection rates. All of these factors point to a sharp decline in available capacity, leading to a market direction value of -3. 

Combine this with the score and a subscriber will know there is an extreme lack of capacity in El Paso and that action is required to mitigate the potential deteriorating service and rising costs. Carriers will know to accept more loads into the market. 

Both score and direction give insight into long- and near-term trend changes, alerting a SONAR subscriber to capacity trend changes in each of the 135 markets for RFP/bid or transactional spot market analysis. Subscribers have the choice of either using a 4- or 52-week data sample size, which is used to baseline the market. Use the 4-week data for daily transactional decisions and 52-week data to see variance from longer trends. 

List of tickers:

TickerDescription
CTSSV4Capacity Trend Score Shipper Van 4-week
CTSSV52Capacity Trend Score Shipper Van 52-week
CTSSR4Capacity Trend Score Shipper Reefer 4-week
CTSSR52Capacity Trend Score Shipper Reefer 52-week
CTSCV4Capacity Trend Score Carrier Van 4-week
CTSCV52Capacity Trend Score Carrier Van 52-week
CTSCR4Capacity Trend Score Carrier Reefer 4-week
CTSCR52Capacity Trend Score Carrier Reefer 52-week
CTDV4Capacity Trend Direction Van 4-week
CTDV52Capacity Trend Direction Van 52-week
CTDR4Capacity Trend Direction Reefer 4-week
CTDR52Capacity Trend Direction Reefer 52-week

These new SONAR indices will help shippers, carriers or brokers prioritize the markets that need attention on a daily basis. Using Capacity Trend Market Scores and Capacity Trend Market Direction, SONAR subscribers can see the markets that have the most significant tightening or easing conditions. Used as a guide, these new indices can lead to lower costs and improved profitability. 

Zach Strickland, FW Market Expert & Market Analyst

Zach Strickland, the “Sultan of SONAR,” curates the weekly market update. Zach is also one of FreightWaves’ Market Experts. With a degree in Finance, Strickland spent the early part of his career in banking before transitioning to transportation in various roles and segments, such as truckload and LTL. He has over 13 years of transportation experience, specializing in data, pricing, and analytics.

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