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Home 3PLs

Trucking markets: Brokers lose control of spot rates

by Tony Mulvey
Tuesday, September 8, 2020
in 3PLs, Trucking
Reading Time: 1 min read
1

(Photo: FreightWaves / Jim Allen)

It’s official: Freight brokers have officially lost control of truckload spot rates. One of the most commonly cited benchmarks in the freight brokerage industry is the important, dense and liquid Chicago to Atlanta lane, which most brokers worth their salt can quote in their sleep. Long suppressed by carrier density and brokerage buying power, rates on that lane jumped 10.5% to break above the national average last week.

 

Chicago to Atlanta is the kind of lane brokers transact truckload movements on so often that there’s normally no need to cite rate assessment tools — brokers usually know what the price should be and adjust rates up or down depending on carrier sentiment.

 

Part of the reason is that Chicago to Atlanta is dense: It’s an important route connecting two of the largest freight markets in the country. CHI to ATL is also liquid: There’s a high number of small carriers based in Chicago, and the lane itself is 717 miles — just the right length to efficiently utilize a driver’s hours of service for a whole day.

 

Those factors normally make the CHI to ATL lane easy to cover, and rates tend to be low and stable relative to other origin-destination pairs in the country, particularly lanes that originate in Southern California. But that changed last week: Now Chicago to Atlanta is more expensive than the national average spot rate on truckstop.com, suggesting that freight brokers are struggling to hold down spot prices even on lanes where they have the natural advantages of density and liquidity.

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Tags: 3PLsChicago to Atlantafreight brokerslogistics researchtransportation researchTrucking spot rates
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Tony Mulvey

Research Associate, FreightWaves

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