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Shipping Trends for May 2024: Latest Freight Market Cheat Sheet

Download this quick reference guide to stay on top of LTL, truckload, intermodal and cross-border shipping trends, plus tips you can apply to your supply chain.

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Welcome to the Freight Market Cheat Sheet.

In this short guide, supply chain professionals (like you) can get a quick update on what's happening in North American freight markets this month. 

Get insights driven by market experts and proprietary network data.

(If you'd prefer, you can also download this as a PDF.)
 

Jump to Section:
Overview | Truckload | LTL | Intermodal 
Mexico | Canada | Coyote News
 

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Freight Market Overview

Another month into 2024, and the market is still skidding along the bottom...for now. 

While there is plenty of carrier capacity to meet current shipper demand, and it seems like rates have just been moving sideways for a few months, we have seen progressively more signs of seasonal life. 

It's unlikely that the base cost-per-mile we're seeing will return to this level, possibly ever again.

We are at the cusp of moving into the next phase of the truckload market cycle and getting into full truckload market inflation later in 2024.

Let's look at a few trends before diving into rates and modes.


The Road Check effect 

From May 14th to the 16th, the Commercial Vehicle Safety Alliance (CVSA) will launch their annual International Road Check (aka DOT Week or DOT Blitz). 

As a result, we are fairly confident that we are going to see rates push up over the coming weeks and for some regions to become challenging. 

  • Historically, we see ~5% rate inflation over the course of Road Check week
  • Looking at the last three years: 2021 was 8%, 2022 was 3%, and 2023 was 7%

Read everything you need to know about DOT Week


And then comes Memorial Day

Like last year, the week after Road Check is immediately followed by the week leading into Memorial Day weekend, the unofficial kick-off of summer shipping season.

In 2023, that two-week span led to a 10% rate increase, resetting the baseline higher for the remainder of the year.

In 2024, we find ourselves in a pretty similar environment (soft volumes, low spot rates), however, there are a few important differences:

  • Continued attrition to the carrier supply base has reduced capacity
  • There is a slightly improved demand environment, driven by increasing imports, restocking efforts, stable consumer spending, and increased manufacturing

All this could lead to another push up on rates, setting the bar higher. 


Also, produce season is in swing

We continue to see signs of life from seasonal produce markets, with southern and central Florida, southern Texas and southern California all experiencing rate increases and incremental capacity tightening.

Last year, produce demand was weak, as a number of compounding weather events limited crops yields.

This year, projected yields look better. Furthermore, we’ve seen the total carrier base decline around 5% Y/Y, so we expect to see slightly more capacity disruptions in 2024.

To learn more about these seasonal trends, read the Shipper's Guide to Produce Season.
 


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Full Truckload Trends: May 2024

Across the board, we saw another month where rates remained essentially flat, dropping 1.7% in April compared to March. 

All equipment types also ticked down a notch, with dry van ending at -1.4% M/M, reefer at -2.3% and open deck at -0.5%.

That said, with the aforementioned DOT week / Memorial Day / produce season trifecta, it's likely M/M will increase next month.

Looking at year-over-year comparisons, we finally crested back into inflationary territory, both in total (3.5%), dry van (4.1%), and reefer (4.3%), with flatbed being the lone exception (-4.3% Y/Y).

While we won't be able to fully confirm the flip until the Q2 numbers are all in, we're off to a good start.

Note on the data: all truckload rate figures are derived from Coyote's proprietary transactional data. With thousands of daily shipments, it is one of the largest centralized freight marketplaces in North America. 
 

Want the updated truckload market forecast?

Read the latest Coyote Curve® index, or download the slides for your next presentation.


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LTL Trends: May 2024

Former Yellow terminals start to open

Carriers are starting to open terminals they purchased through the Yellow closure.  

Most recently, XPO opened Las Vegas, NV; Landover, MD; and Sherman, TX. In 2024, they have opened six terminals, with plans to open 12 by the end of Q2 and 24 by the end of the year.

Furthermore, Estes and Saia are both looking to open 20 new terminals in 2024.  

Not all these terminals will be in new markets, but for those that are, carriers will be looking for new business to fill up the added capacity. 
 

LTL carrier pricing discipline remains strong

While the truckload market has been flat, LTL carriers continue to maintain pricing discipline.

We're seeing general rate increases (GRIs) range from 4.9% to 5.9% for pricing programs based on carriers' current base rates.

For customer specific pricing agreements (CSPs), we're seeing adjustments ranging from 3% to 7% range.

Most carriers are targeting adjustments at a lane level, or at a weight and class level, attempting to drive specific freight to them.  

We expect this pricing discipline to remain across the LTL industry for the time being.


Related: How to Ship LTL, the Comprehensive Guidebook



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Intermodal Trends: May 2024

Potential strike looms over the Canadian rail industry

Canadian rail workers authorized a strike vote:

"With a vote in place, more than 9,300 workers at Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC) can go on strike as early as May 22.

The workers are represented by Teamsters Canada...conductors, locomotive engineers and yard workers at CN voted 97.6% to authorize a strike, while 99% of staff in those same positions at CPKC voted to permit the strike."

What this could mean: if neither of Canada's two largest railroads agree to a deal with the Teamsters union representing critical railroad employees, the entire Canadian rail network would shut down as early as May 22nd.

Given the lack of recent progress in negotiations, it's looking increasingly possible that the Canadian government could intervene to resolve the impasse. That said, in lieu of a deal, it's unknown whether direct government action would come before, or after a network shutdown. 

This is the first time that the Teamsters contracts with both Canadian railroads are up for renewal at the same time, and neither want to appear as having negotiating a "worse" long-term deal.

Regardless of whether one, or both, new Teamsters contracts are hammered out prior to the deadline, every shipper currently moving freight on the rail in Canada should have a contingency plan.

In the event of a 5/22 shut down, have a game plan for how you'll manage the subsequent hours, days and potentially weeks if Canadian rail service grinds to a halt. 


Union Pacific shaves two days off of LA/Chicago intermodal service

On May 3rd, the Union Pacific reported that it cut down transit time for domestic intermodal service to three days for customers transporting goods from the Los Angeles area to the Chicago area.

What this means: In practice, the UP's standard intermodal transit between Los Angeles and Chicago has been reduced to 4 -5 days door-to-door (when you factor in drayage), which is competitive with over the road trucking.

For example, a load that picks up in Anaheim on a Thursday morning could be delivered to a distribution center in Milwaukee on Monday. 

This move follows the Union Pacific's opening of a new Inland Empire Intermodal Terminal in Fontana/Bloomington earlier in April, which offers a more convenient option connecting shippers in the Los Angeles Basin's busiest warehouse district. 


Volumes go up, driven by imports

Through April, total North American intermodal volume increased 8%-9% Y/Y.

The majority of that volume boost has come from international traffic (20' / 40' / 45' international containers), while 53' domestic intermodal volume has held essentially, seeing only small Y/Y gains.

Container and driver capacity remains strong in most major metros across the U.S., Canada, and Mexico

Related: Learn about the difference between international and domestic containers


Contracts rates go down, spot rates stay flat

We've come just about to the end of the traditional intermodal bid season (which runs through April/May).

Most intermodal shippers saw long-term contract offers from the railroads come in significantly lower than in 2023, while spot rates have stayed largely flat for yet another month.

Customers who play in the transactional/spot market are still seeking lower rates as OTR rates remain depressed, but most providers have gone down as far as they are willing to go. 

Related: Intermodal vs. Truckload: 4 Things Every Shipper Should Know


 

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Cross-Border Mexico Trends: May 2024

Produce season in full swing in Mexico and creeping into southern U.S. states. 

We've seen this reflected with a slight increase in northbound rates (up 2.5%) and a decrease in southbound rates (down -1.2%) in April compared to March.

We're expecting a gradual increase out of Mexico, particularly Laredo, leading up to the 4th of July holiday.

Note on the data: all truckload rate figures are derived from Coyote's proprietary transactional data. With thousands of daily shipments, it is one of the largest centralized freight marketplaces in North America. 
 

Next phase of CCP regulation is live

Complemento Carta Porte (CCP) 3.0 went live on April 1st.

This regulation creates additional steps for shippers and transportation providers, and covers both domestic Mexico and cross border shipments.

All carriers, shippers and brokers must be in compliance with the additional regulations of version 3.0 (vs. the previous 2.0 version).

Coyote, of course, is in compliance. Have questions? Check out our FAQ for the Complemento Carta Porte.

Related: How to Ship U.S.-Mexico Cross-Border Freight
 

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Cross-Border Canada Trends: May 2024

Like the U.S. market, Canada has had a very stable first four months of the year, with costs remaining within a 5% range for the entire year to date.  

In April, all Canadian rates ticked down -1.5% compared to March, with northbound dropping -2.9%, and southbound dropping -7.9%. 

This has been largely driven by a lack of consumer demand — the volume of orders remains soft relative to current capacity. 

While we expect the stability to remain for much, if not the full year, the potential strike (see the intermodal section) could throw the market into chaos, as Canadian supply chains are thrown into disarray and more freight is converted to truckload.

Note on the data: all truckload rate figures are derived from Coyote's proprietary transactional data. With thousands of daily shipments, it is one of the largest centralized freight marketplaces in North America.


Again, a potential strike looms for the Canadian rail industry

We covered it in the intermodal section, but in case you missed it, this could have major ramifications to every aspect of Canadian supply chains. 
 

New quoting and payment options for Canadian freight, with Coyote

If you're interested in getting instant freight quotes for your Canadian truckload or LTL freight (either inbound or outbound), now you can, with Coyote

You can get real-time pricing on our site (coyote.com), in our digital freight platform (CoyoteGO), or in your own TMS via API. 


Related: How to Ship U.S.-Canada Cross-Border Freight


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