According to FreightWaves, there are positive signs as demand is returning in the trucking market. The signs are from truckload volume data from FreightWaves. They have a system that measures tender requests in North America. It assesses load requests from shippers to carriers. The same helps avoid any false data. It helps provide info on the market trends. Therefore, more often than not, FreightWaves is always informed ahead of the rest. The numbers in 2020 were not as good as the ones in 2019. There was a recession in mid-2019. Then covid hit and caused even more disruption.
Capacity vs. Demand
Despite the volumes being up, capacity is still more than demand. As far as volume is concerned, the US is doing well. On the other hand, motor carriers are not seeing any improvements. According to numbers from FreightWaves, rejection levels are very low. It means that carriers are accepting all loads at the moment. They are doing so to remain active in the market. When the tender rejection rates increase, carriers will feel optimistic about the market.
Supply vs. Demand
Supply and demand are currently not in sync. Freight always responds to supply and demand signals. Volume improves the moment the goods economy grows. Recent growth is a result of retailers having cleared stock. They are now refilling the same. Supply and capacity go hand in hand. With covid, there was more buying of goods. There were more drivers and carriers to fulfill demand. When demand fell, the market now had too much capacity. More trucks are chasing the dwindling demand.
An increase in volume does not mean the spot rates were doing any good. The rates dropped from $2.02 per mile on Jan. 9 to $1.82 per mile on Jan. 25. The figure is not lower than the lowest ever. But the trend has been a downward one for a while now. It is giving the truckers hope about the market. The positive thing is that truckers need to hold on for just a few months now. Stronger volumes from produce and the spring shipping season will make things better.