Outbound tender volumes (OTVI.USA) finished this week up 3.02 percent year-over-year. This continues the gains the index has posted since July 24th, when 2019 tender load volumes surpassed those in 2018.
OTVI began the week with a rocky start though, dropping 1.10 percent before recovering by Thursday to finish 63 basis points (bps) higher compared to the previous week. The index also almost dipped below its 60-day moving average, before recovering to finish above it by 2.20 percent.
Dallas and Houston saw the largest drops in outbound volumes this week. Dallas was down 9.95 percent, while Houston dropped 8.44 percent. In contrast, Laredo experienced 4.55 percent higher outbound load volumes.
The Midwest balanced out the weakness in Texas this week. Indianapolis, Indiana was up 5.87 percent while Chicago posted a 5.22 percent gain in tendered load volumes. In the Southeast, Atlanta had modest gains (up 2.79 percent) this week, while out west, Los Angeles outbound load volumes decreased slightly (down 1.9 percent).
“Load volumes for the remainder of 2019 really depend on policy decisions and the market’s reaction to them,” said Ibrahiim Bayaan, Chief Economist at FreightWaves. “Within the last 30 days the U.S. announced 10 percent tariffs on Chinese imports and then rolled those back. This uncertainty will hinder business decisions. Another key data point we’re watching out for are trends in global economic growth. Most of the economic data out of China and Europe has been poor lately. If this trend continues it is likely to be a drag on the U.S. economy.”
Tender rejection rates remain at 2019 lows
Gains in truckload volumes usually leads to increases in rejection rates as capacity tightens. This has not happened yet in 2019. Outbound rejection rates (OTRI.USA) finished the week where they began at 3.86 percent, which remains the lowest level over the past 12 months.