The Canadian spot market saw better conditions in October. Capacity has left the system, tightening the truck-to-load ratio to 3.64, down 16% year over year.
There could be some volatility in spot market freight volumes due to labor strife at the ports and Canada Post, Loadlink reported.
South of the border, the most recent week was a good one for refrigerated rates. Thank the U.S. Thanksgiving holiday for that. Shippers enjoyed their strongest month of the year in September, according to FTR, while ACT Research indicates the freight market is slowly coming back into balance.
Canadian spot market continues to gain strength
Loadlink Technologies reported steady year-over-year spot market performance in October. Volumes pulled back 2% from September levels and are nearly identical to 2023 levels, the company says.
Equipment postings increased 5% from September but were down 17% from last October. The truck-to-load ratio sat at 3.64 in October, up 10% from September, but down 16% year over year.
“Historically, November has usually seen larger freight activity than October, much of it due to American Thanksgiving period impacting cross-border activity and the inbound holiday season in December. In the last decade, only 2014, 2015, and 2018 saw minor declines in month-over-month load volumes, while the remaining years averaged 14% more loads in November,” Loadlink Technologies summed up.
“With the current ongoing Canada Post strike and container congestion from recent port strikes, there may be some short-term fluctuations in freight activity. If current load volumes trend remains consistent, 2024’s freight performance should end the year similarly to 2023 levels as load volumes.”
September shipper conditions strongest of the year
FTR’s Shippers Conditions Index improved in September, from 2.9 the prior month to 4.6. The bump reflected lower fuel costs, looser capacity and lower freight rates.
FTR is projecting conditions for shippers to deteriorate in the months ahead.
“The fact that September’s index is the strongest since last December is not a sign that shippers’ market conditions are steadily improving,” noted vice-president of trucking, Avery Vise.
“September and May were modest outliers this year in a market that is at least becoming more balanced. We expect that trend to continue and for SCI readings to be mostly negative to neutral in 2025 and 2026. However, markets in transition tend to be volatile, so further outliers are likely and possibly in both directions. The supply chain implications of tariffs are a wild card for 2025 especially.”
For-hire freight market coming into balance
ACT Research noted in its latest For-Hire Trucking Index that the market is coming back into balance. Volumes increased 7.4 points to a reading of 56.9 in October, up from 49.5 the month before.
“The rebound in volumes month over month may be tied to recent port and hurricane disruptions, but broadly speaking, freight demand trends are gradually improving,” said Carter Vieth, research associate with ACT Research. “The economy continues to exceed expectations, and notably in Q3, durable goods spending rose 8.3% quarter over quarter SAAR. Threat of another ILA strike on Jan,.15 has likely caused shippers to pull freight forward, and with tariffs on the horizon following the election, the pull-forward in freight is expected to accelerate further.”
ACT’s Capacity Index decreased 1.1 points in October.
“While slowing growth from private fleets is helping to ease pressure on for-hire carriers, eight quarters of weak profitability point to capacity additions occurring at replacement levels,” Vieth said. “U.S. Class 8 demand is softening, indicating that tractor fleet growth — a key reason this cycle is the longest on record — may soon be coming to an end. However, further declines are needed for capacity to start tightening.”
The Supply-Demand Balance improved in October to 57.2 thanks to improving freight volumes and reduced capacity.
“Private fleet expansion, which is not captured in this indicator, has resulted in a longer period with the market close to balance than in past cycles. Slowing U.S. Class 8 tractor sales in recent months are further rebalancing and moving the cycle forward, albeit slowly. Continued strong US economic growth is leading to improved goods demand and will make its way to the for-hire market as private fleet growth slows,” Vieth concluded.
Reefer rates rebound
The week ended Nov. 22 saw refrigerated rates on the U.S. spot market reach their highest levels since January, within a broader spot market that’s tracking closely with last year.
“Broker-posted spot rates for refrigerated equipment saw their biggest increase since May to the highest level since January,” reported Truckstop and FTR Transportation Intelligence.
“Large increases in refrigerated spot rates are the norm for the week before Thanksgiving. Dry van spot rates rose modestly while flatbed rates eased. The week that includes Thanksgiving – this year, the week ending November 29 – usually produces a strong increase in dry van spot rates as pressure from last-minute Black Friday stocking runs into a holiday-related drop in capacity. In recent years, refrigerated spot rates typically decline during Thanksgiving week as the week before is when food deliveries are under greater pressure. Moves in flatbed spot rates have been inconsistent during Thanksgiving week.”
With load postings increasing slightly and truck postings falling, the Market Demand Index ticked up to 61.7, the weakest level in 10 weeks except for the prior week.
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