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Market Watch for Oct. 3:
Demand in Atlanta remains consistent at the start of the fourth quarter.
Outbound volumes from the Empire of the South may be down 14% from this time last year, but given the overall degradation of demand in 2022, we’ll be optimistic and say that things could certainly be worse.
The Outbound Tender Volume Index for Atlanta is seeing 4.9% growth week over week at the start of October, and Atlanta holds the majority market share by outbound volume with 4.1%.
In an additional cause for celebration, the Braves swept a three-game MLB series from the New York Mets over the weekend to earn their 100th victory of the season and move closer to securing a fifth straight National League East Division title.
Inbound tender volumes to Atlanta have been consistent as well over the last couple of weeks. However, inbound rejections spiked last week as Atlanta was expected to be right in the path of Hurricane Ian, indicating carriers were trying to stay away.
Meanwhile, outbound capacity reacted similarly, pushing the Outbound Tender Reject Index up 72 basis points (bps) in the last week to 4.5%.
Jacksonville, Florida, avoided major damage from Hurricane Ian, but many areas still remain flooded, bringing outbound truckload volume from there to a halt.
The Outbound Tender Volume Index went into a free fall once Ian began to start making landfall in southwestern Florida on Sept. 26, dropping almost 32 points, or 23%, to 109.5 — its lowest value since 2020.
Inbound rejection rates skyrocketed last week — and understandably so — as carriers were trying to stay out of the market. The Inbound Tender Reject Index increased 246 bps to 8.5% last week but has since begun to settle back down and is currently at 8.2%.
Until flooding is cleared in the northern parts of Florida, outbound rejection rates from Jacksonville remain elevated, currently at 7.8%.
NTI as a point of reference
The National Truckload Index is a daily look at how spot rates in specific lanes hold up in comparison to the national average, giving carriers and brokers an idea of which lanes to gravitate toward or avoid.
Diesel fuel prices are continuing to drop into the fourth quarter.
This time last month, diesel was still costing drivers $5.10 per gallon but fell below $5 per gallon at the end of September and is continuing to decline.
Excluding the initial jump in prices in late February once Russia invaded Ukraine, prices are dropping faster than they were rising. Prices exceeded $5 per gallon in early March and sat at $5.08 on March 20. It took them three months to rise 70 cents to their peak at $5.82 on June 20. In the three months that followed, prices dropped 85 cents per gallon to $4.96 on Sept. 20.
Since then, prices are down another 8 cents to $4.88 per gallon.
Lane to watch: Atlanta to Orlando
As parts of Jacksonville remain inaccessible for drivers, volumes into central Florida are increasing for storm relief efforts.
Inbound tender volumes to the Lakeland market, which Orlando falls under, are up 12.6% since the beginning of last week. However, inbound rejections remain high at 5.8%, indicating that not all carriers are willing to enter the market and putting upward pressure on spot rates.
Since last week, spot market rates from Atlanta to Orlando are up 14 cents to $3.45 a mile — 74 cents above the national average.
I am not condoning using others’ misfortune for financial gain, but this is a lane where carriers can make a good chunk of change while, most importantly, helping those in need.
There is also a good amount of risk involved in entering the Florida markets. First, there is the case of having equipment either damaged or held up due to inaccessible roads. Second, since there is not much freight leaving these markets, drivers will likely need to deadhead out in order to secure another load.