National average spot rates inclusive of fuel soared by 26 cents last week (9.1%) to $3.11 per mile. This was a positive development as it was the third straight weekly increase (following four straight weeks of falling rates). Spot rates are now barely off of all-time highs and are higher by 56.3% year-over-year. Given the stabilization and aggressive move up in tender rejections over the past few weeks, spot rates are trending up and may have staying power.
Contracted tenders rose 12.2% week-over-week off of a very easy winter weather-affected comparison. This same figure was just 3% Tuesday, so tenders are accelerating. Contract volume on a tender rejection-adjusted basis is outpacing 2020 levels by 10% (down from 15% last week). There should be an acceleration in rejection-adjusted tender volumes too as the worst of the winter storm days exits the seven-day moving average.
Relative capacity tightened by 522 basis points to 27.87%, just 59 bps off the all-time high, which indicates the rise in tenders was also driven by rising load volumes.
The backdrop for truckload (at least through 1H 2021) remains healthy with a strong consumer, further stimulus forthcoming and a recovering industrial economy. The back half of 2021 is more uncertain, but the recent winter weather only adds to the bull case.
Consumer spending, according to Bank of America card spending data, was only up 0.9% year-over-year last week due to weather.
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