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SONAR Sightings: Demand sinks in Ontario, California; global ocean booking volume off 20%

The highlights from Wednesday’s SONAR reports are below. For more information on SONAR — the fastest freight-forecasting platform in the industry — or to request a demo, click here. Also, be sure to check out the latest SONAR update, TRAC — the freshest spot rate data in the industry.

Market Watch for Oct. 5:

Ontario, California

Outbound volumes from Southern California are down, down and down again.

I’ve said it a hundred times before and I’ll say a thousand times more: Southern California is the heartbeat of truckload volume. National outbound volume has been stagnant the past couple of weeks with a slight downward trend, coinciding with when Ontario, California, started a decline in its own outbound capacity.

Since Sept. 16, the Outbound Tender Volume Index in Ontario is down 130 points, or 22.8%, to 437.6 — its lowest value since 2020. This has made room for the Atlanta market to take the most outbound volume market share and for Dallas to begin catching up as well.

Rejection rates are rising this week as volume still declines. The Outbound Tender Reject Index is up 115 basis points in the past three days to a two-month high of 3.2%, reflecting carrier sentiment to search the spot market for better rates and opportunities.

SONAR Tickers: OTVI.USA, OTVI.ONT with “Dual” display

Elizabeth, New Jersey

The number of twenty-foot equivalent units cleared through customs and ready to enter the surface transportation market are trending up this week, but rejection rates in Elizabeth, New Jersey, are taking a nosedive.

The SONAR seven-day moving average of imported TEUs to the Port of New York/New Jersey is up 17% this week, but outbound tender volumes from Elizabeth have yet to react, remaining consistent and essentially where they were at the end of September.

Rejection rates, however, are responding already, as they provide a more up-to-date view on capacity trends. The Outbound Tender Reject Index for Elizabeth is down 75 bps overnight as imports increased. This indicates that carriers are effectively punching auto-accept on their contracted tenders.

SONAR Tickers: CSTEU.USNYC, OTRI.EWR with “Dual” display

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.

NTI Daily

Ocean demand

Global demand continues to slide into the fourth quarter of the year, affecting both air and ocean carrier operations.

FedEx Express reported a major loss last month, and Maersk just dropped two trans-Pacific services.

Up to 90% of cargo around the world is moved on the waves, and while that number may still hold true, the amount of freight actually being shipped is dropping interminably.

Booking volumes are 20% lower than they were at this time last year. Shipper booking volume is what tells the story of consumer demand. When a customer puts in an order, shippers send requests to carriers to pick it up.

Since Saturday, booking volume from all 95 ports in SONAR Container Atlas is down 13.5%. This is a key indicator that consumer demand is dropping even faster than expected, especially for this time of year, leading into the winter peak season.

SONAR: Container Atlas

Lane to watch: Ontario to Indianapolis

Spot market rates from Ontario to Indianapolis are down 3 cents this week to $2.12 a mile — the lowest in over a year.

On the upside, carriers are looking at four transit days, or over 2,000 miles, with a good chance of booking a load afterward. Indianapolis is one of the only markets with over 1.5% market share that is seeing an uptick in volumes this week, and these long-haul truckload lanes are picking up slack from the rails after being rattled by the threat of a strike last month.

Outbound rejection rates from Indianapolis jumped 65 bps in the past couple of days as well. The increase in rejections will put upward pressure on spot rates leaving Indianapolis.

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Corey Smith

Corey is a staff writer for FreightWaves with experience in air, intermodal and parcel operations, as well as LTL and full truckload transportation management. He is a graduate of the University of Memphis, majoring in supply chain management, and enjoys basketball, cinema and traveling.