Arrive Logistics March 2024 Freight Market Update

Arrive Logistics has released its March 2024 Freight Market Update, and we're breaking down the report for you.

Key Points

• Demand's holding steady, with load postings aligning closely with last year's figures. U.S. import volumes are keeping pace, even with challenges like Red Sea disruptions.
• Supply's correcting but at a slower pace. We're seeing more new entrants and fewer revocations, hinting at a stabilizing carrier population.
• Spot rates have dipped, reaching near cycle lows again. But, diesel prices stabilizing offers a bit of a breather.

Demand Dynamics

Spot load postings in February dropped 28% from January and were down nearly 12% YoY. Yet, this is an improvement over the 36% year-over-year plunge in January.

• Both tender volumes and accepted loads are seeing an uptick.

Supply

Moderating Exit Rates: There has been a slowdown in the rate at which carriers are leaving the market, coupled with an uptick in new entrants.

With dry van tender rejections dipping below 4%, there's a hint a steadiness. Reefer tender rejection rates are just below 5%, slightly higher YoY.

Rates

Spot Rates Take a Dip: Across the board, we're seeing a downward trend, with dry van spot rates hitting $1.55 per mile, a nod to the cycle lows observed in October 2023. Reefer rates aren't faring much better, with a notable slide to $1.84 per mile in March, marking a 12% decline from January.

Contract Rates Hold Steady: Despite the fluctuations in spot rates, contract rates have remained relatively stable. For dry vans, rates are at $2.03 per mile, while reefer rates have experienced a slight adjustment, now sitting at $2.60 per mile excluding fuel.

The spot-to-contract rate spread widening by $0.05 to $0.48 per mile

What’s Next?

The balance between supply and demand suggest a market headed toward stablization. With diesel prices steadying and the spot-to-contract rate spread offering insights, all roads lead to cautious optimism.

Our forecast still calls for loose market conditions to continue with periods of regional volatility as the produce season kicks off.

Source: Arrive Logistics