Outbound tender volumes (OTVI.USA) finished this week up 1.67 percent week-over-week, 1.58 percent month-over-month and 4.82 percent year-over-year. Miami led the way as volumes exploded 29.47 percent and are hitting a 52-week high ahead of Hurricane Dorian. Even higher volume totals are expected once Friday’s volume data is in FreightWaves SONAR.
The OTVI index also increased the spread above its 60-day moving average and is now comfortably ahead by 5.39 percent (compared to 3.75 percent last week). On an absolute basis, OTVI first crossed over 2018 levels in late July, an early signal of a bottoming in freight market volumes.
Miami saw the biggest increase in activity this week, followed by Cleveland and Newark, which posted very strong numbers that typically might otherwise lead the pack in a normal week. Cleveland jumped 10.48 percent, while Newark followed closely behind, up 10.44 percent. Chicago also posted notable strength, up 7.63 percent. On the other hand, after leading the way to the upside last week, Texas led the way this week on the downside with Houston down 6.65 percent and Dallas down 3.77 percent. The West Coast was solid with Ontario, California up 4.57 percent and Los Angeles up 3.07 percent.
Tender rejection rates move up and continue their winning streak off the bottom
Outbound tender rejections continued climbing to 4.68 percent off its mid-August lows of 3.77 percent. Over the past week OTRI.USA is up nearly 10 percent and up 18.76 percent since the end of July. For only the second time in 2019, outbound tender rejections climbed above their 60-day moving average – a strong sign that rates may move higher leading into peak retail season. The early effects of Hurricane Dorian are already being exhibited in OTRI.ATL and OTRI.MIA. Tender rejections coming out of Miami have spiked in the past few days as shippers attempt to move freight ahead of the storm. Disaster relief freight pays above average rates due to time constraints and heightened needs. Subsequently, tender rejections leaving Atlanta have tumbled more than 12 percent, or 46 basis points over the past week. However, because overall national tender rejection rates did not fall below double digits until January 2019, the year-over-year comparisons are astronomical, with current outbound tender rejections down nearly 75 percent from this time last year.
Until September 6th, FreightWaves SONAR is free to anyone. Sign up here and get a deeper look at these indices and keep up with the effects of Hurricane Dorian.