Everything You Need To Stay Up-to-Date On Spot Rates
Spot freight rates resemble the stock market, no price is too low for a bear or too high for a bull. As to say, there are natural fluctuations that can be forecasted and predicted but not calculated. This is why strategic sourcing ends up saving company money, you’re protected from spot rate fluctuation. These shifts in rates arise from gas prices, import and export industry, jobs and wages, the economy and so much more.
Here’s how you can stay on top of spot freight rates.
Resources for Current Spot Freight Rates (Domestic & International)
Load boards, or freight boards, are living databases used by shippers, carriers and freight brokers for sourcing or promoting freight services. Load boards have become software products that offer additional services such as messaging, credit information, safety verification, mobile access and more. Load boards usually offer a free preview with a call-to-action to upgrade to the paid edition (or a free trial). A few leading truck freight resources include,
- DAT (Truckers Edge and DAT Power)
DAT (formerly dial-a-truck) began operating in 1979 and is extremely well known in freight industry. They have a customized platform for trucking owner-operators (Truckers Edge) and for brokers and shippers (DAT Power).
- Trucker Path
Trucker path boasts their load board has 800+ brokers, more than 150K daily loads and most notably, 300K+ downloads of their highly rated mobile app.
Trulos is a free loading board with state-by-state searches and all types of freight. The site includes a routing tool that helps identify the most fuel efficient route with the least elevation and most downhill miles.
- Free Freight Search
Free Freight Search has over 104,000 registered members and gives members access to 33,000+ freight broker credit reports along with weekly articles and resources.
Load boards apply to truck freight. Air and ocean freight are more nuanced. Opposed to the standard A-to-B route, international freight requires seven steps, two of those involving documentation. There are too many variables for real-time load boards, but there are important things to know and resources to use. The main difference between truck and global trade is the role of a freight forwarder. Freight forwarders manage the process of international shipping which includes transportation (trucking, air and/or ocean) and customs paperwork. The process includes these checkpoints:
- Export Haulage
- Export Customs Clearance
- Origin Handling
- Ocean Freight
- Import Customs Clearance
- Destination Handling
- Import Haulage
Understanding each step is the best method for managing international freight rates. Along with examining every spot quote to make sure everything above is accounted for. Failure to do so could mean an unexpected upcharge on the final invoice.
Additionally, there are some great publications to follow for real time trends and expert insight. A few of these include,
- Freight Waves
- Inbound Logistics
- Logistics Management
- Global Trade Magazine
- Supply Chain Dive
- Supply Chain Brain
Spot Freight Rate Trends
DAT provides a trend dashboard which collects the national supply and demand of all types of freight and the load-to-truck rates quarter-by-quarter. Q1 2019 showed volume rates rising, which has been a trend over the past 12 months. Van and reefer rates trended down slightly, while prices trended up for the flatbed segment. Fuel prices have stayed relatively stagnant, increasing less than 1%.
Air & Ocean
According to Glyn Hughes from International Air Transport Association (IATA), air cargo growth has been struggling to find consistency since the global financial crisis one decade ago. Capacity growth was up 9.3 percent in 2017, while growth in supply or lift was up 3 percent. The IATA released more disappointing numbers in 2019, with demand decreasing 1.8 percent.
For ocean freight in 2019, overall capacity is projected to increase by less than 3 percent, but global trade is predicted to grow around 6 percent. There are several factors expected to impact ocean freight according to logistics giant C.H. Robinson,
- Terminal congestion – The majority of shipments arrive at the major ports around the world. The resulting delays have been a trend in previous years and are expected to continue.
- Chassis shortages – A chassis is special trailer for transporting ocean containers on land. Many of these units in the U.S. are being used for storage which leads to the shortage.
- Driver and drayage capacity shortages – The Electronic Logging Device was enacted in 2018 and has resulted in driver shortages. The mandate forces drivers to track their hours of service electronically to ensure compliance and fairness in pricing.
- Rail service realignmen – A large portion of railroads are expected to convert to Precision Scheduled Railroads (PSR) in 2019. This will improve efficiency over time but may cause hiccups during the implementation.
- Rail service realignment – A large portion of railroads are expected to convert to Precision Scheduled Railroads (PSR) in 2019. This will improve efficiency over time but may cause hiccups during the implementation.
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