Research built for present and future c-suite executives.
Intermodal volumes are still weak year-over-year and capacity is for the most part quite loose.
Lanes where intermodal spot rates have risen reflect a market where traditional sources of freight, like coastal ports, are under-performing. IMCs are charging more to send containers into Los Angeles and less to bring containers out of L.A., indicating that freight outbound from southern California ports is not sufficient to meet capacity.
There are two issues that are creating further congestion in North American intermodal networks. The first is an oversupply of empty containers in the United States, which has been the natural consequence of the extraordinary number of sailings voided by the containership lines. While new freight was not coming into the country, empty containers were also not being returned to Asia.
Secondly, Chinese ports are ramping outbound containers just as demand for consumer goods is plummeting in the United States. Not only are consumers not spending, but non-essential receiving facilities are in many cases shut down. In the worst case scenario, retailers in the middle of a pronounced revenue squeeze may find themselves laying out cash to take in goods they can’t sell.
These challenges are likely to produce some dislocation in intermodal and, frankly, trucking markets as North American transportation networks digest coronavirus-related volatility.
You have selected content that's only available to members of FreightWaves Passport. As a member, you gain immediate access to the most in-depth and informative freight research available. It's your gateway to continuing education.
Members also get:
Click below to learn more and sign up today!
Subscribe
Existing Passport subscribers may log in using the form below.
John Paul conducts research on multimodal freight markets and holds a Ph.D. in English literature from the University of Michigan. Prior to building a research team at FreightWaves, JP spent two years on the editorial side covering trucking markets, freight brokerage, and M&A.