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Home 3PLs

Reefer markets: Dallas heralds COVID part II

by Tony Mulvey
Thursday, July 9, 2020
in 3PLs, Shippers, Special Topic, Trucking
Reading Time: 1min read
1

(Photo: Jim Allen / FreightWaves)

The question on our minds now is whether Dallas is the first stage of another March-like surge in refrigerated volumes driven by the coronavirus. In response to a spike in new infections, Texas officials closed bars and limited restaurants, causing outbound and inbound Dallas reefer volumes to turn upward to anomalous levels.

 

We’ve written before about how the March volume surge was led by short-haul and refrigerated freight, consistent with the idea that consumer food-buying was an important factor driving the rally. That’s happening again in Dallas, and if similar patterns take hold in other Southern cities with COVID outbreaks, including Los Angeles, Phoenix, Houston, Atlanta and Miami, then expect a replay of that March surge along with all of its downstream effects.

 

Those effects include disrupted shipper supply chains, imbalanced carrier networks and lower asset utilization, longer wait times at distribution centers, higher rates, and a host of complicated facility/shipper requirements around social distancing and hygiene that will slow 3PL operations.

 

Certain aspects of the March COVID surge seem inevitable. Businesses that stay open will definitely buy up cleaning supplies to disinfect their workspaces, for example. But it’s unclear to what extent the “second wave” will prompt the same level of irrational consumer hoarding we saw in March.

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Tags: Dallas/Fort Worthreeferreefer capacityReefer markets
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Tony Mulvey

Research Associate, FreightWaves

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