COLUMBUS, Ind. – The freight market continues to be characterized by overcapacity, and with private fleets engaging in spot activity more than in past cycles, spot rates remain only slightly above the late-2023 lows, according to the latest release of the Freight Forecast: U.S. Rate and Volume OUTLOOK report.
“Class 8 tractor backlogs are thinning, but retail sales remain above replacement, more than two years after the spot market turned down,” said Tim Denoyer, ACT Research’s vice president and senior analyst. “This fits the definition of a prebuy to a tee.”
According to Denoyer, mid-July rates have exceeded seasonal patterns by around four cents due to a temporary boost from Hurricane Beryl. The storm hit during a seasonally soft period for the truckload spot market. Storms during stronger seasonality may have a larger impact on rates.”
“Freight market conditions are usually soft in early July, but DAT’s load/truck ratio rose meaningfully in the days following Beryl and have remained stronger than normal seasonality since,” Denoyer said. “Of course, the surge will likely be short-lived. But in our view, a seasonally adjusted DAT load/truck ratio at 7 signals a market closing in on balance, if still not quite there yet. We need to see this measure at an 8 or 9 to push rates up much.”
The DAT load/truck ratio isn’t exactly a scale of 1 to 10. It can go further than 11. It reached the mid-teens in 2017 and early 2018 and the high teens during 2021, peaking above 20.
The monthly 58-page ACT Freight Forecast report provides analysis and forecasts for a broad range of U.S. freight measures, including the Cass Freight Index, Cass Truckload Linehaul Index, and DAT spot and contract rates by trailer type. The service provides monthly, quarterly, and annual predictions for the TL, LTL, and intermodal markets over a two- to three-year time horizon, including capacity, volumes, and rates.
Dana Guthrie is an award-winning journalist who has been featured in multiple newspapers, books and magazines across the globe. She is currently based in the Atlanta, Georgia, area.
