The hot newsletter out of Silicon Valley, The Information, spilled the deets on Uber Freight’s explosive growth: they’re hauling in $40M of top-line revenue per month, putting the digital brokerage on a $500M run rate annually. The other major digital brokerage, Convoy, is on a run rate exceeding $300M, and they’ve done it without the backing of a mega-corporation like Uber, which was valued at $72B back in February during the Waymo case.
Uber Freight officially launched last May, on a mission to disrupt the American freight industry and its network of 16,000 brokers. We’re interested to see where the digital brokerage model will ultimately fit in a sector traditionally reliant on relationships, trust, and a whole lotta phone calls.
Did you know?
The rate of tendered reefer loads rejected by carriers in the Houston freight market climbed from 15.7% to 33.8% in about a week.
“If you look at the traditional brokerage today, they’re making calls, in most cases, about 30-60 calls to cover a load. They’re scrambling this information from sources such as load boards, emails, spreadsheets, phone calls, and what they’re doing is they’re handling a lot of stale information.”
-Prasad Gollapalli, founder and CEO of Trucker Tools
In other news:
Georgia’s new inland terminal open for business
Georgia Gov. Nathan Deal and more than 350 state and local officials celebrated the opening Aug. 22 of the new Appalachian Regional Port (ARP) in Northwest Georgia. (Railway Age)
Port district of Houston-Galveston became a net exporter of crude oil for the first time in April
The U.S. port district of Houston-Galveston in Texas became a net exporter of crude oil for the first time on record in April and exports continued to increase in comparison to imports in May, according to the U.S. Energy Information Administration. (Hellenic Shipping News)
Cannabis supply chains coming out of the shadows
Around the state, a nascent network of specialized distribution companies is springing up to connect these centers of licensed marijuana growers and processors to hundreds of retail outlets, providing something entirely new in the marijuana industry: a legitimate supply chain. (Wall Street Journal)
U.S., China impose new tariffs on each other as talks resume
The U.S. and China imposed fresh tariffs on each other’s goods in the middle of trade talks aimed at averting the worsening conflict between the world’s two biggest economies. (Bloomberg)
Aramco IPO halted, oil giant disbands advisers
Saudi Arabia has called off plans for the domestic and international listing of state oil giant Aramco, billed as the biggest stock flotation in history, four senior industry sources said on Wednesday. (Reuters)
The ‘legal’ market for cannabis is currently valued at $6.2B, and while it’s dwarfed by a black market estimated at $50B, the legal pot trade is expected to grow 200% by 2022. Now that growers and dispensaries have some amount of protection from local and state law enforcement agencies, the supply chain is beginning to mature. In California, the center of American cannabis cultivation, production has become more diffused. For decades, pot production was concentrated in the Northern Californian ‘Emerald Triangle,’ comprised of Humboldt, Mendocino, and Trinity counties, and the crop was moved south into population and consumption centers by personal vehicles.
Since medical and recreational marijuana were legalized, a network of indoor growing facilities in Southern California has emerged. It makes sense: according to Cannabis Benchmarks, indoor, hydroponically grown weed commands more than a 100% premium over marijuana grown outdoors. Marijuana may never be hauled by the reefer trucks that move traditional agricultural products because it’s still illegal on a federal level, so commercial vehicles can’t get insurance to cover this highly valuable cargo. Instead, smaller, armored vans equipped with alarms and track-and-trace telematics move shipments of five pounds or less to dispensaries in a manner more similar to the transfer of physical cash than lettuce.
Hammer down, everyone!
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