eShipping’s Monthly Industry Updates – September 2023
Everybody’s got a lot on their plate right now, so here’s a way for you to stay up-to-date on the latest news without the extra hassle. Introducing…the eShipping Industry Update Report.
Each month, our team sits down to comb through the metrics, trends, and key takeaways on the state of the logistics industry to help your business plan for the coming months.
Less Than Truckload (LTL)
Yellow’s Bankruptcy Being Felt Across LTL Network
Less than Truckload carriers continue to report higher shipment counts following the closure of Yellow Corp. Freight began fleeing Yellow’s network in mid-July when the company said it wouldn’t be able to make required benefits payments. Its union workforce threatened to strike and customers quickly sought other options for capacity.
Saia reported a 13% year-over-year increase through mid-August, and Arc Best reported a 20% increase in shipment count within their core accounts. XPO reported that shipments per day increased 6-8% from the beginning of July through the end of July and are still seeing increased levels in August.
LTL carrier tonnage was down for the year, so this helped position carriers to take on the freight that flooded the market. However, many carriers are now hitting max capacity and are implementing rate increases and are turning down less desirable freight as a result. Likewise, with carriers being at max capacity, many customers are seeing missed pickups and delayed transit shipments at a higher rate than they did previously in the year.
Average Price Of Fuel Is Climbing
The national average diesel fuel continues to climb but still lower than one year ago.
Full Truckload (FTL)
Full Truckload Market Begins To Tighten Leading Into Consumer Season
Tightness in the FTL market is being felt by those matching trucks to loads for the first time in several months. A $0.30 drop in rate per mile since January coupled with fuel rising for the last 8 consecutive weeks has given carriers the edge to pushback in negotiations. Drivers deadheading to pick up loads is far less popular with the increasing fuel. Freight is still moving, but increasing lead time has been beneficial to combating the rising rates and limited carrier availability.
Full Truckload rates have seen a slight uptick in the Van arena, while refrigerated units and flatbeds have remained relatively unchanged, according to DAT’s Trendlines Analysis. As the industry begins gearing up for Q4, and the high demand that comes with consumer season.
Outbound Tender Rejections Up
According to the Freightwaves SONAR, the Outbound Tender rejections are on the way up, hitting 4% for the first time since the beginning of the year. This suggests that carriers are changing the strategy and becoming more selective in their loads. Making sure to choose more profitable opportunities to combat pressure on their bottom line.
International
Carriers Begin Announcing Large-Scale Blank Sailings
In the Trans-Pacific, ocean carriers are forced to urgently and aggressively take blanking action through to the middle of October. The 2M is pulling out total 8 sailings (4 USWC + 4 USEC) in the 1st week of October and another 6 sailings in the 2nd week, which is almost half of their capacity from Asia. (HLS)
“Shippers should monitor their carriers closely and start preparing for large-scale blank sailings to be announced in the coming few weeks for the month of October.” (ContainerNews)
Due to increased demand and blanked sailings ex Asia to US, eShipping recommends pre-booking 2 weeks in advance to secure space with carriers, especially the lower cost and/or direct transits.
The August numbers match closely with July’s blanks, or 23% of the 1.1 million TEUs in service during July. (JOC)
West Coast dockworkers ratify a new six-year contract.
The US west coast is safe from the threat of strikes finally. Dockworkers have voted in favor of ratifying a contract agreement bringing to a close a period of significant industrial unrest. (Splash 24/7)
Airfreight Rates Lowest Since Start of Pandemic
Airfreight rates have fallen to their lowest level since the pandemic began, according to the latest figures from both Xeneta and Tac Index. And signs of a peak have all but vanished, according to Clive Data Services.
Global Air Cargo capacity increased by 12% from last year, no major backlogs currently. (DHL)
Parcel
FedEx announces rate changes effective Jan 1, 2024
FedEx lists an average rate increase of 5.9% across FedEx Express package and freight standard list rates for US, US Export, US Import services, and FedEx Ground standard list rates. In reviewing each service level, we are seeing the following increases. (Top Left)
FedEx also announced surcharge increases. Here are the increases for the most common charges. (Bottom Left)
UPS matches FedEx rate change
UPS Inc. said late Thursday that it will raise 2024 tariff rates 5.9% on all air, ground and international services, effective Dec. 26. (FreightWaves)
Warehousing
eShipping Distribution Services’ Sacramento, CA Warehouse Live
The Sacramento team is up and running and began receiving inbounds a couple weeks ago.
Fulfillment orders and outbound shipments have begun as well.
Let eShipping know if you have any questions or interest in this location
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