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Home 3PLs

Ocean markets drive the domestic freight markets

by Tony Mulvey
Monday, October 4, 2021
in 3PLs, Featured, Intermodal, Rail, Trucking
Reading Time: 2min read
0
Ocean markets drive the domestic freight markets

We often demo SONAR to customers that want to see every domestic freight dataset we have to offer while showing little interest in our ocean data. 

That has always been puzzling to us because we believe that the ocean shipping markets and the domestic freight markets are inextricably linked.  

The most obvious linkage is that a rise in the volume of oceangoing imports portends a rise in domestic freight demand and a fall in import volume portends a drop in domestic freight demand. 

But, the connection goes much further than that. 

To fully understand the domestic freight markets, one must not just keep on top of overall import volume trends, but also:

  • Seasonal ocean shipping patterns
  • Ocean shipping rates
  • Container ship capacity trends
  • Container availability
  • Port market share trends
  • Inland international and domestic intermodal container flows
  • Truckload market conditions at the port cities 

Understanding those trends help market participants predict:

  • The supply-demand dynamics of local freight markets
  • Mode shifts between truckload and intermodal
  • Which truckload lanes will become stronger headhaul or backhaul lanes
  • Locations where equipment or driver availability issues are likely to become more severe. 

Those insights help:

  • Carriers to better position their assets and know which freight markets to most heavily target. 
  • Brokers to refine their rates and their negotiating tactics with carriers for changes in market conditions. 
  • Shippers to best manage their supply chains to avoid bottlenecks, manage their carrier networks and hold their carriers accountable for their rates and service levels. 

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Tags: domestic transportation networkslogistics researchOcean shippingtransportation research
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Tony Mulvey

Research Associate, FreightWaves

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