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Market Watch for September 26
Releases are steadily increasing as the volume of truckloads decreases from Southern California.
Although the import share of West Coast ports is at its lowest since the early 1980s, Ontario still holds the largest market share of outbound truckload volume at 4%. However, the full truck market is not completely spared by the drop in imports.
Freight volumes from Ontario are trending lower in the second half of September after hitting a six-month high. The outbound tender volume index fell 12.8% last week to the lowest value since the start of this year, when ports experienced large numbers of waiting ships.
Rejection rates have increased by 19 basis points (bps) since last week, but are currently only 2.7%. This is the third time this year that the outbound bid rejection index for Ontario has been below 3%.
Greensboro, North Carolina
On the East Coast, outbound volumes in Greensboro, North Carolina are at yearly highs.
Since Sept. 19, Greensboro’s outbound bidding volumes have increased 54.7%, bringing the outbound bidding volume index to 92.5, the highest since November 2021.
This prodigious increase pushed outbound levels to exceed inbound volumes for the first time since February by 28%. The gap between the two sent Greensboro’s Headhaul Index soaring 819% in just one week to 20.3, the highest reading since February 2021.
However, even though incoming capacity is much lower than the amount of outgoing demand, rejection rates are falling. This is likely because carriers do indeed automatically accept freight. The Outbound Tender Reject Index is down 130 basis points since last Wednesday at 3.7%.
“We have seen rates drop for shipments from North Carolina over the past two to three weeks. Rates, in the Midwest in particular, have fallen while regional shipments have remained relatively flat,” said Dylan Dameron, vice president of operations at Axle Logistics. “The volume of imports to Virginia and North Carolina will be an important indicator of regional rates/capacity during the fourth quarter.”
Freight volumes out of Houston are steadily falling to their lowest levels since June.
Over the past week, Houston’s outbound bidding volume index fell 53 points, or 14%, to 325.6 — its lowest reading in three months. The decline caused outbound tenders to plunge below the volume of inbound volumes by 5.3%, plunging the Headhaul Index by 48 points to -18.3.
The significant drop in truckload volumes coincides with a sharp drop in imports into Port Houston that took place last week. After setting record numbers in August, US Customs maritime import shipments on September 19 fell nearly 22%.
The steady decline in volumes continues to loosen capacity. Since the drop on September 19, the outbound tender rejection index has fallen 90 basis points to 3.8%, the lowest value since April 2020.
NTI as reference
The National Truckload Index is a daily look at how spot rates in specific lanes hold up against the national average, giving carriers and brokers an idea of which lanes to gravitate to or avoid.
Way to watch: Houston at Dallas
Spot market rates from Houston to Dallas bottomed earlier this month at $2.96 a mile, but have since recovered 10 cents to $3.06 a mile, 41 cents above the national average. As volumes and releases see a decline in Houston, Dallas could be a place for better opportunities at the moment.
Rejection rates in Dallas are relatively high at 5.29%, just above the national average of 5.21%, and Dallas remains the third largest truckload market with an outbound market share of 2.9 %.