• ITVI.USA
    10,751.730
    -679.100
    -5.9%
  • OTLT.USA
    3.005
    -0.267
    -8.2%
  • OTRI.USA
    20.330
    0.360
    1.8%
  • OTVI.USA
    10,700.870
    -711.780
    -6.2%
  • TSTOPVRPM.ATLPHL
    2.960
    0.380
    14.7%
  • TSTOPVRPM.CHIATL
    3.710
    0.160
    4.5%
  • TSTOPVRPM.DALLAX
    1.290
    -0.010
    -0.8%
  • TSTOPVRPM.LAXDAL
    3.720
    0.010
    0.3%
  • TSTOPVRPM.PHLCHI
    2.240
    0.100
    4.7%
  • TSTOPVRPM.LAXSEA
    4.160
    0.060
    1.5%
  • WAIT.USA
    132.000
    -5.000
    -3.6%
  • ITVI.USA
    10,751.730
    -679.100
    -5.9%
  • OTLT.USA
    3.005
    -0.267
    -8.2%
  • OTRI.USA
    20.330
    0.360
    1.8%
  • OTVI.USA
    10,700.870
    -711.780
    -6.2%
  • TSTOPVRPM.ATLPHL
    2.960
    0.380
    14.7%
  • TSTOPVRPM.CHIATL
    3.710
    0.160
    4.5%
  • TSTOPVRPM.DALLAX
    1.290
    -0.010
    -0.8%
  • TSTOPVRPM.LAXDAL
    3.720
    0.010
    0.3%
  • TSTOPVRPM.PHLCHI
    2.240
    0.100
    4.7%
  • TSTOPVRPM.LAXSEA
    4.160
    0.060
    1.5%
  • WAIT.USA
    132.000
    -5.000
    -3.6%
FreightWaves LIVE

SONAR expands its reefer data

Lane Signal app becomes reefer aware

Since its introduction in 2018, FreightWaves SONAR has provided subscribers with the most current freight market data, analysis and insights. 

SONAR is the only freight forecasting platform that combines contract tender data with spot rate data and creates predictive freight rates. In addition, SONAR uses artificial intelligence to develop consistently updated forecasts to give subscribers the most reliable predictions of where trucking spot rates, supply chain demand and logistics capacity are headed over the next 12 months.

The latest improvement to SONAR and SONAR Supply Chain Intelligence (SCI) is the addition of even more data on the temperature-controlled/refrigerated (or “reefer”) trucking sector.

The reefer sector is extremely volatile, and therefore harder to benchmark, analyze, monitor and forecast. However, SONAR and SONAR SCI provide the data, intelligence and analysis that subscribers need to be much more knowledgeable on the reefer sector of the market.

A reefer trailer costs nearly three times as much as a dry van, which means there are fewer reefer trailers in the market. In addition, the regional imbalance of this type of freight, niche commodities, and severe seasonality can lead to major price and capacity fluctuations over the course of a year. 

FreightWaves SONAR and SONAR SCI data and applications can help subscribers navigate this unpredictable market. The latest expansion of SONAR and SONAR SCI provides even more reefer market data and gives subscribers more support for informed decision-making.       

Tender Data

SONAR was the first freight forecasting platform to provide near real-time tender data. A pure representation of demand and carrier availability at a contracted price, tender data only measures requests to haul freight and the percentage of those requests that were unsuccessful. Unlike spot rate data, tender data is not lagged or corrupted by market participants trying to inflate or deflate publicly reported prices. 

The reefer tender volume indices (ROTVI) measure fluctuations in demand for contracted reefer capacity. Indexed to tender volumes present on March 1, 2018, users can see when shippers are requesting more or less capacity on a daily basis.

Reefer tender rejection indices (ROTRI) measure the percentage of shippers’ electronic requests that were declined by carriers. The higher the percentages, the tighter the market, which leads to higher prices for both spot and contracted agreements. 

FreightWaves Scientific Rates

FreightWaves developed a rate that combines average trucking costs with tender data and other inputs – providing reefer market fluctuations in the form of a scientific rate. In addition to measuring current pricing pressure direction, the algorithm also forecasts rates up to 12 months in the future. These rates are designed to closely resemble the buy side spot rate with no intermediary markup or fuel cost. 

Reefer scientific rates are aggregated to the national level in the SONAR platform. Users also have the option to see historical predictive values for 7- and 28-day predictions to see if something has altered expectations or signaled a divergence from seasonal movements. These rates are offered at a lane level in the various applications throughout the SONAR platform such as Lane Scorecard, SONAR SCI and Lane Signal. 

Contract Rates

Average invoiced reefer rates at an aggregate level are in SONAR and at a lane level in the SCI application. These rates are derived from over four years of invoices representing nearly $100 billion of total spend (20% is reefer truckload). 

The aggregated national values are represented as an initial report and a final report value. The initial report is a seven-day moving average of the median rate of the invoices reported on a 14-day lag; the final report value is on a 28-day lag. The initial report is faster but less complete (representing over 50% of the total invoices), while the final report is more complete and representative of over 70% of the total invoices. Most invoices are based on long-term rates or contracted agreements with daily fluctuations caused by lane mix and route guide waterfalling. 

Spot Rates

SONAR has spot rates from Truckstop.com’s top 100 reefer lanes and a weighted average in order to measure rate volatility in the nation’s most active lanes for reefer spot freight. 

These rates can be viewed as either a rate per mile or total rate, with both including fuel surcharges. 

The reefer truckload market has several niches that can have strong seasonal movements, fluctuating much more than more dry van freight. One of the most notable is fresh produce; rates may double during harvest season. SONAR uses USDA data to give an average all-in rate for produce-specific loads. 

Lane Signal – Reefer Awareness

The newest SONAR reefer data is in SONAR’s Lane Signal application. The Lane Signal app is SONAR’s tactical solution to view daily changes at an individual lane level. Lane Signal now includes reefer-specific insights, and users can toggle between dry van and reefer data. 

In Lane Signal, scientific rates are displayed in the bottom half of the page for low-, median- and high-cost carriers. Providing additional context, SONAR Signals show whether the origin or destination market has conditions that favor a shipper or carrier in rate negotiations. Values above 50 indicate demand outpaces supply and below 50 suggests there is excess capacity.  

An ideal use case for Lane Signal is a tactical daily analysis on a load moving in the spot market in which the user needs to know how rate conditions have changed since the last time freight was quoted or moved freight in that lane. 

Perhaps the most valuable insights lie in the various directional changes in the scientific rate. It shows whether or not conditions are favoring upward or downward rate pressure over last week, last month, or last year – and projects them into the future. 

Lane Scorecard

Using the Lane Scorecard app, a SONAR subscriber can analyze batches of reefer lanes for bids or for multiple spot rates. Lane Scorecard provides scientific rates, SONAR Signals and Lane Scores for multiple lanes at a time. This data prioritizes lanes that need attention first and gives insight into current and future rate direction.  

Quoting or bidding on multiple lanes is a cumbersome process for carriers and brokers, while shippers tend to have little information on transportation market conditions. Lane Scorecard improves upon Lane Signal – not only by allowing a subscriber to measure multiple lanes, but by adding data points to help measure volatility and prioritize each lane. 

Volatility scores have a range from 1-100; high values indicate lane conditions may change often. Low rates relative to the market leaves a shipper more exposed to falling to the spot market than in a lane with a low volatility score.

Lane scores also have a range from 1-100; lane scores above 50 are indicative of lanes in which carriers have fewer options and are more willing to trade price for volume. Lane scores below 50 indicate that carriers have stronger than average optionality and these lanes are prone to shippers bidding up the price.  

The output is easily exported into an Excel file for further analysis. 

SONAR Supply Chain Intelligence

SCI allows users to benchmark rates against the market and peers, while providing access to lane scores, origin/destination volatility, and carrier compliance measures for deeper analysis. 

Designed with a transportation manager in mind, SCI can help to save money either directly through lower contracted rates or indirectly by lowering the risk of falling to the spot market. SCI also saves time through lane prioritization. 

Users can identify cost-saving opportunities by seeing lanes in which rates are above market or peer averages and have high lane scores and compliance rates. Conversely, users can identify lanes in which they are exposed to a high risk of loads falling to the spot market when they are priced below market and have low lane scores and low compliance rates. 

SONAR and SONAR SCI subscribers have used the freight forecasting platform to make more informed decisions since its introduction. Since SONAR’s launch FreightWaves has regularly added data and features, making it easier to use, more robust and even more important to subscriber operations. The inclusion of actionable information on the reefer market is the latest improvement to the platform.  

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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