Spot Market Insights: Spot rates rise further heading into Memorial Day

Overview:

• For week 20 in the spot market, 2 of the 4 key market indicators increased. The overall Market Demand Index (MDI) fell 9.0 points to 209.2 as load availability decreased 0.6% and truck availability rose 3.6%. Compared to last year the MDI is up 116.4 points, or 125.6%. Last week, market rates rose 2.6% to $3.57. Compared to last year, rates are up 46.4%. National fuel prices eased $0.02 cents to $5.59 from $5.61 per gallon in the previous week.

Commentary:

• Data from Truckstop.com and FTR Transportation Intelligence for the week ended May 22 showed a spot market that retained all the prior week's International Roadcheck-induced rate strength and built on it during the week leading into the Memorial Day holiday weekend.

• Once again, broker-posted spot rates in the Truckstop.com system rose for all equipment types. Dry van spot rates posted the strongest gain among all equipment types and were only about 12 cents below their all-time high in late December 2021. Refrigerated spot rates were about 30 cents below their record, which was during the same week. Flatbed spot rates rose for a 21st straight week and for the 26th time in the past 27 weeks to another record level.

• Spot rate gains were not uniform, however, as rates for loads originating in the Southeast were up strongly for all three principal equipment types but were mixed by equipment types in other regions. In recent years, dry van and refrigerated spot rates have tended to settle for a few weeks before the inevitable late June surge, but very tight capacity and the need for fuel cost recovery clearly have disrupted seasonality substantially. The sustained run-up in flatbed rates defies seasonal patterns, of course.

• Total load postings eased slightly after Roadcheck week's spike while truck postings recovered somewhat from the prior week's sharp drop. The result was a modest decrease in the Market Demand Index to 209.2 from the previous week’s level, which had been highest in five years.