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Supply Chain Graphic of the Week: Another Scary Picture of Rising Transportation Cost

Dry Van Spot Market Rates Continue to Head Higher and Higher


Aug. 16, 2018


US transport costs - notably for truckload shipping - are soaring at unprecedented levels.


For example, milk producing giant Dean Foods said it saw a 26% jump in costs with external carriers, according to a call with analysts by CEO Ralph Scozzafava.

The company is far from alone, as firms ranging from Coca-Cola to Caterpillar have been sounding the alarm."Nobody has a crystal ball, but if I had to place a bet I would say this is structural, not cyclical change," said Lee Clair, managing partner at Transportation and Logistics Advisors – meaning high rates are here to stay.

Knight Transportation just said its revenue per loaded mile, a measure of rate growth, soared 21% in the second quarter versus 2017. The company is getting customers that now are paying high spot-market rates to sign long-term contracts with big rate increases just to ensure they can get trucks.

But a picture is worth 1000 words, so below is the trend in dry van spot market rates, based on data from load board DAT Solutions, as reported in the Wall Street Journal.





As can be seen, spot rates since March of 2017 are up about 43% - an enormous rise.


When will it stop? No one seems to know. We'll say this if this is the price to pay for a robust economy, we'll take it.


Any Feedback on our Supply Chain Graphic of the Week? Let us know your thoughts at the Feedback section below.


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