In early October, the East and Gulf port strikes and consecutive hurricanes caused short-lived and regionalized volatility, but conditions reverted to normal seasonal patterns later in the month. Though this holiday peak season could be more volatile than last, a sustained market shift remains unlikely until mid-2025.
Key Takeaways:
Month-over-month and year-over-year spot postings increased significantly in October.
Trucking employment declined again, indicating ongoing capacity attrition due to poor market conditions. However, overall levels remain elevated.
Dry van tender rejections remain relatively low amid strong supply, and increased carrier revenues during the holiday season will likely continue this trend.
Rates remain relatively flat and in line with seasonal expectations but may increase meaningfully as the holiday season begins, particularly for reefer equipment.
Recovery efforts from Hurricane Helene and Milton are still underway, but the freight market impact has diminished.
Reefer markets have not been this volatile since early 2022, as shown by large year-over-year increases in tender rejections, indicating routing guide challenges and rate volatility could intensify this winter.
What’s Happening: Supply handled volatility well in October.
Why It Matters: Tighter capacity conditions leave the market more vulnerable to disruption.
The Morgan Stanley Dry Van Freight Index is another measure of relative supply; the higher the index, the tighter the market conditions. The black line with triangle markers on the chart provides a great view of what directional trends would be in line with normal seasonality based on historical data dating back to 2007.
Despite recent routing guide disruptions and rate volatility, as of mid-November, the latest reading shows no meaningful activity or demand increases and trends returning to the 10-year average amid seasonal cooling.
Morgan Stanley Dry Van Truckload Freight Index
Morgan Stanley Reefer and Flatbed Truckload Freight Indices
The latest ACT For-Hire Trucking Supply-Demand Balance Index shows that conditions softened in September, largely due to declining freight volumes amid strong supply. However, October and November readings will likely show tightening based on the market disruption observed over the last 60 days. Market conditions could be volatile through year-end as holiday disruptions, such as shippers closing facilities and drivers taking time off, create demand surges and routing guide challenges. Severe storms will also be a factor as winter weather sets in across the country.
ACT For-Hire Trucking Survey
Weather-related disruptions caused unexpected delays and impacted routing guides in early October, creating tightness despite the oversupplied market. The Sonar Outbound Tender Reject Index (OTRI) measures the rate at which carriers reject the freight they are contractually required to take. It has remained over 5% since early October — the longest stretch since Q3 2022 — and is approaching the high water mark set around the Fourth of July 2024.
Outbound Tender Reject Index (SONAR)
Dry van tender rejections ticked up in mid-October, deviating from the sharp decline in October 2023. Tightness will likely increase as Thanksgiving approaches, and there is potential for more routing guide disruption this holiday season than at any point in 2023 and 2024.
Van & Reefer Outbound Tender Reject Indices
Like dry van, reefer rejections ticked up in October, deviating from 2023 trends. Then, in early November, the index surpassed 17.0, nearly twice the November 2023 reading and the highest since April 2022. If this persists, the reefer market will become increasingly vulnerable to significant disruption this holiday season, and rates will likely rise as volume grows through year-end.
The DAT Load-to-Truck Ratio (L/T) measures the total number of loads relative to the total number of trucks posted on its spot board. The van L/T rose by 18% from September to October, reaching levels similar to October 2022 and 2023, likely due to the disruptive weather events at the beginning of the month. Reefer L/T told a similar story, ticking up over 16% to reach just above October 2022 levels. These indexes should remain elevated through year-end as demand increases and capacity tightens this holiday season.
What’s Happening: Supply handled volatility well in October.
Why It Matters: It will be tested again as the holiday peak season approaches.
Resilient carriers continue to exit the market slower than in previous months. October revocation data shows over 4,800 carrier entrants and exits. As a result, the net change in the overall carrier population was effectively zero. Recent disruptions and holiday season rate increases, paired with recent fuel declines, are offering many carriers a sense of stability, which may keep carriers and drivers in the market longer.
FTR’s Carrier Revocations, New Carriers & Net Change in Carrier Population
We continue to monitor the evolving role of private fleets as they increase their share of the for-hire market despite volume declines. With less freight available, for-hire carriers are negotiating rates aggressively to maintain volume and revenue, putting downward pressure on spot rates in turn. If this trend persists, it could extend the current rate environment deeper into 2025.
US Truckload Market Mix Shifts, ACT Research & Cass Freight Index
According to the latest data from ACT Research on U.S. Class 8 tractors, the backlog-to-build (BL/BU) ratio increased slightly from 4.5 months in September to 4.8 months in October. Overall, the backlog remained stable, with just 800 additional units added in October. As a result, it stands at approximately 61,000 units, about 1,500 units above the four-year low. Low build rates indicate the backlog will likely remain soft.
ACT Research, U.S. Class 8 Tractors: Backlog and Backlog/Build Ratio
The most recent ACT For-Hire Driver Availability Index reading declined from 55.4 in August to 53.6 in September. That marks 28 consecutive months with a reading above 50, a clear indication there is no driver shortage. Driver availability is expected to decline slightly as the FMCSA prevents CDL drivers with a prohibited status from driving. However, recent reports indicate the number of affected drivers will be minimal, limiting the impact of the new regulation. As a result, driver availability is expected to remain relatively high in the near future.
ACT For-Hire Trucking Index: Driver Availability
Trucking jobs declined by 100 on a seasonally adjusted basis in October, marking the second consecutive month of modest losses following a gain of 1,400 jobs in August. Some October volatility and a more promising holiday peak season than last year are helping to curb additional declines. Still, current capacity trends indicate that these rate increases will be short-lived, and a sustained recovery is still a ways off.
What’s Happening: Retailers are pulling freight forward to avoid potential disruption.
Why It Matters: While positive in the short term, this could negatively impact 2025 demand.
Import forecasts for the remainder of the year have improved, calling for over 2 million TEUs in November and just under 2 million in December. The revision comes as retailers proactively pull freight forward to avoid two potential disruptions: the new administration raising tariffs and port strikes resuming in mid-January. Though this volume surge should benefit the market in the near term, it could negatively impact demand in 2025.
NRF Monthly Imports
DAT reports that October spot loadings were up 26.6% from September and nearly 20% from October 2023. The year-over-year increase is notable since loadings had declined by over 40% from October 2022 to October 2023. This surge likely correlates with the disruption caused by Hurricanes Helene and Milton in late September and early October, which forced contract volume into the spot market and spurred an influx of recovery-related freight.
What’s Happening: Canada’s Minister of Labour, Steven MacKinnon, intervened to end the Vancouver and Montreal port strikes.
Why It Matters: Goods are again flowing through Canada’s two largest ports.
What’s Happening: Spot rates are rising.
Why It Matters: This indicates the end of a market cycle.
What’s Happening: Seasonality is driving regional tightness.
Why It Matters: Rates are rising in these areas.
East Coast
Midwest
South
The rest of the South is quiet, as expected for this time of year.
West
Pacific Northwest (PNW)
What’s Happening: LTL carriers are expanding through acquisitions.
Why It Matters: This trend will likely continue.
What’s Happening: Rates are rising as the holidays approach.
Why It Matters: Higher spot rates could disrupt shipper routing guides.
Rates across all modes increased sharply following the early October hurricanes and continue to rise as demand increases and capacity tightens ahead of the holidays. This trend is particularly pronounced in the van and reefer sectors. Truckstop’s weekly spot rate data shows dry van rates hovering around $2.00 per mile and reefer rates at $2.45 per mile. Rates for both modes have increased by $0.20 per mile over the past six weeks and will follow typical seasonality, rising again around Thanksgiving and Christmas. Flatbed rates remain down, with no major movement since early October.
Truckstop Weekly National Spot Rate Average
National diesel prices rose slightly in October and fell again in early November. Low fuel prices have benefited carriers navigating higher operating costs amid low revenues. The long-term fuel cost outlook remains relatively favorable for carriers, as the incoming administration has said it will ramp up domestic oil production to bolster supply and drive down prices.
DAT Fuel Trends
DAT dry van data shows spot and contract rates have steadied after experiencing some inflation in October due to consecutive hurricanes and port strike-related activity. The spot-contract gap remains elevated at $0.37 per mile, making sustained disruption unlikely.
DAT Dry Van National Average RPM Spot vs. Contract
The reefer spot-contract rate gap has closed to the lowest level in this cycle at just $0.27 per mile, as spot rates surpassed $2.00 per mile, excluding fuel, for the first time since January 2024. Early November contract rates, a key catalyst for the gap closing, could normalize as the month goes on, but a tighter gap indicates increased routing guide vulnerability similar to the recent rise in rejection rates for the equipment type. Spot rates followed a similar trend in 2023, rising by $0.07 per mile from October to November. An increase is likely ahead of Thanksgiving due to higher demand for food items.
DAT Temp Control National Average RPM Spot vs. Contract
Flatbed rates rose slightly in early November but remained relatively stable. Contract rates increased by $0.03 per mile, and spot rates fell to $1.94 per mile, excluding fuel. Ultimately, the flatbed market continues to follow a different pattern than dry van and reefer. However, the spot-contract rate gap remains historically elevated, with no major disruptions likely in the near term.
DAT Flatbed National Average RPM Spot vs. Contract
What’s Happening: Inflation rose in October.
Why It Matters: Consumer spending remained steady nonetheless.
Inflation rose from 2.4% in September to 2.6% in October, still short of the 2% target rate. Though the Fed may cut interest rates by another quarter percent during its December meeting, there would be little to no impact until mid-2025.
Recent Bank of America credit card data shows consumers displaying solid momentum going into the holidays. Spending rose 1.0% year-over-year in October after declining 0.9% year-over-year in September. The University of Michigan’s consumer sentiment index has been rising consistently since July, indicating positive consumer sentiment. Consumers should maintain relatively stable spending levels until interest rates fall further and wages grow.
Bank of America, Total Card Spending per Household
We anticipate typical seasonal patterns will continue to shape the narrative as peak season approaches. Recent disruptions, reflected in higher tender rejection rates and increased spot market activity, suggest a more balanced market than this time last year.
Demand appears stable, driven in part by shippers accelerating imports due to concerns over a potential second port strike and possible tariff hikes. Despite this, supply appears adequate to maintain routing guide compliance through peak season. While the 2024 holiday season may be more volatile than last year, robust supply should enable a swift return to equilibrium following any fluctuations.
As the new administration’s policies take shape, their implications for transportation markets will become clearer. Key areas we are monitoring include tariffs, immigration, labor, regulatory changes and environmental initiatives.
A market flip is not out of the question with the right catalysts, but we are not yet ready to call for widespread disruption in the near term until there are more signs of vulnerability in the data or imminent black swan events that could shock demand or supply.
