The highlight reel from Monday’s SONAR reports. For more information on SONAR — the fastest freight-forecasting platform in the industry — or to request a demo, click here.
Lanes to watch
By Zach Strickland, director, Freight Market Intelligence
KANSAS CITY (Missouri) to INDIANAPOLIS
Overview: Reefer rejection rates remain elevated at 47.01% on the MCI–IND lane as freight volumes decline.
Highlights
- Reefer freight volumes declined to 16.54 index points in the Kansas City market, but reefer rejection rates have climbed to 47.01 on the MCI–IND lane.
- Indianapolis’ reefer headhaul score has increased to 43.09 as capacity tightens in the market, pushing rejection rates up to 57.95%.
- Indianapolis shippers have increased tender lead times to 3.70 days as market conditions tighten.
What does this mean for you?
Brokers: As reefer freight volumes decline in the Kansas City market, rejection rates have slowly trended downward as market conditions soften. Brokers should search the spot market for reefer freight that runs across the MCI–IND lane, but keep their bids elevated since reefer rejection rates are still elevated in the Kansas City market. Push carrier rates down since the Indianapolis market will be a strong destination for carriers. Capacity is tight in the Indianapolis market, and reefer rejection rates have climbed back to 57.95%.
Carriers: Reefer carriers with excess capacity in the Kansas City market should search the spot market for loads that deliver into Indianapolis. Keep your bids elevated since reefer rejection rates are elevated at 47.01% on the lane. Market conditions are tightening in the Indianapolis market, and reefer rejection rates have climbed to 57.95%, opening multiple spot market opportunities for carriers once they have delivered in Indianapolis.
Shippers: Indianapolis shippers need to monitor reefer rejection rates daily, and increase tender lead times out past the national average of 4.33 days since market conditions are tightening. Reefer rejection rates have climbed to 57.95%, and the headhaul score has jumped to 43.09, which will push spot rates upward for on-demand capacity. Prepare for tight market conditions to continue throughout the rest of the year.
NASHVILLE (Tennessee) to JACKSONVILLE (Florida)
Overview: Jacksonville outbound rejection rates have fallen dramatically since the summer.
Highlights
- Nashville’s outbound rejection rates have bounced back above 33% after dipping to an annual low around 26% earlier this month.
- Lane-specific rejection rates to Jacksonville moved similarly and are now settling around 30%.
- Jacksonville’s outbound rejection rates have fallen from their record levels of 48% in June to 26% in early October. Rejection rates are back on the rise, however, pushing over 31%.
What does this mean for you?
Brokers: Watch for highly volatile capacity conditions out of Nashville. The trend has changed from a strong easing to tightening in this lane in a short period of time.
Carriers: Accept a few more loads in this lane. Jacksonville remains a challenging market but much calmer than it was in the spring and summer. Rejection rates are climbing and imports are expected to overflow from the congested Savannah port.
Shippers: Expect a return to tighter conditions out of the Nashville market. Consider deepening the route guide or increasing rates in this lane if your compliance rates are consistently below 70%.
MEMPHIS to KANSAS CITY
Overview: A large surge in the Headhaul Index is signaling that truckload demand is likely to cause tightening conditions.
Highlights
- Memphis outbound tender volumes are up 6% w/w, signaling that demand for outbound capacity is increasing.
- The Memphis Headhaul Index is up 13% w/w, and with weekly inbound international container volumes up 32% year-over-year (y/y), that trend is likely to continue.
- Memphis outbound tender rejections are up 152 basis points (bps) w/w, but that trend is likely to accelerate as demand for capacity increases.
What does this mean for you?
Brokers: It is likely that outbound tender rejections will continue to rise as the Headhaul Index surges 13% w/w. With a major 32% increase y/y in inbound international containers moving into Memphis via rail, this surge in outbound volumes is likely to last through the remainder of 2021. With outbound tender volumes up 6% w/w, outbound tender rejections are very likely to move higher in the coming days and weeks.
Carriers: Stay firm on your rates as outbound tender rejections are likely to increase in the coming days, and that is likely to shift pricing power into your favor. With inbound international volumes seeing significant growth into Memphis, outbound volumes are likely to continue growing through the remainder of the year. Keep an eye on outbound tender rejections and use this index to confirm tightening conditions are indeed driving upward or downward pressure on rates.
Shippers: Your shipper cohorts in Memphis are still averaging 2.6 days in tender lead times. With the Headhaul Index in Memphis up 13% w/w, and outbound tender rejections likely to continue increasing in the coming days, it would be wise to keep your tender lead times between 3 and 4 days through the next couple of weeks to ensure you are able to secure capacity in the market.
Carrier update
Donnie Gilbert, director of customer solutions at FreightWaves, and Lead Economist Anthony Smith take a look at the reefer markets in the Carrier Update presented by PowerFleet.
Check those reefer rejection rates
By Zach Strickland
The national average for reefer outbound tender rejection rates remained steady over the weekend at just above 37.00%, stopping a downward trend that began in early October. SONAR users will need to monitor reefer rejection rates this week to see if rejection rates continue to fall, or start to increase as we approach the end of the month.
Reefer outbound tender volumes have also trended downward, leveling out at 2139.56 index points over the weekend. Shippers in the Fargo, Cedar Rapids, Sioux Falls, Des Moines, Omaha, Twin Falls, Pendleton, Little Rock and Columbia markets has struggled with reefer rejection rates over 60%, and rejection rates have averaged over 50% in the Joplin, Fayetteville, Indianapolis, Jefferson City, Kansas City, Dubuque, Tulsa and Salt Lake City markets.
Carriers will find the most opportunities for reefer freight in the Ontario, Twin Falls, Joliet, Fort Worth, Allentown, Atlanta, Lakeland, Indianapolis, Harrisburg, Fargo and Salt Lake City markets, which are the largest reefer markets by volume in the nation at this time.
Shipper update
Lead Economist Anthony Smith and Donnie Gilbert, director of customer solutions at FreightWaves, look at what to expect in the week ahead in industrial production, housing starts, and initial jobless claims. in the Shipper Update.
This week’s SONAR webinars
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