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Below are a few trends happening in TL and LTL shipping.
What’s happening in TL pricing?
The flatbed rise can be attributed to the following industries:
- Natural gas and plastics – Prices for natural gas have risen internationally, making the US exports of liquid natural gas more attractive. The by products are used to make plastics, which there are an increased supply to sell.
- Construction – New single family homes increased 15% year over year. In addition, state and federal infrastructure projects have kicked off and will continue strong through the fall, which will also cause demand for flatbeds to rise.
- Building products – Demand for flatbeds historically rises in May due to an increase of shipping of building products.
The rise in demand of vans can be attributed to:
- Ties with the increase in demand for reefers, since some products can move on either equipment. Since reefer freight will increase, the number of reefer trucks willing to haul dry freight will decrease, which will limit the available truck pool.
What’s happening in market & capacity?
- Produce has started to ship and as it picks up through April the supply of trucks will decrease and rates will continue to rise. This will happen in the Southeast, South, CA, and AZ. Produce season will run into June.
- Produce is starting to move from southern TX and CA to central TX and CA areas and will continue to push north as the weather gets warmer
- A portion of CA produce has not shipped due to too much rain.
- Mid-March freeze will delay produce from GA, NC, SC
- Demand for trucks increased from March to April and the demand will continue to steadily rise throughout May
What’s happening in LTL pricing?
- LTL capacity remains mainly flat, however LTL carriers are remaining very disciplined in pricing with contracted increases running between 3-5%.
- At LPS we are averaging near that mark, however it can vary greatly depending on customer locations, freight profile, annual spend and demand levels among other things.
- GRI’s (general rate increases) are running slightly higher around 5-6%, with ABF, SAIA and FedEx all recently announcing increase in late 2016 to early 2017.
What’s happening in LTL news?
- Estes is launching Canadian LTL service May 22nd. Estes will utilize new partners to enhance their cross border LTL shipments and will be partnering with Speedy Transport and Pacific Coast Express. Direct billing will enhance visibility and simplify the process for shipping.