Week chart: Initial Report of Van -Sonar Contract Rate: VCRPM1.usa
Long -term rate or contract for Van Van Truck Truck Market (VCRPM1) has lost its move this year compared to the past, and has fallen 0.3 % per hour since early September. While this is still slower than 2 % from 2023 to 2024, the contract rate in the second half of last year showed high pressure signs. These gains seem to be completely cleared. What does this mean for the future?
According to the US Transport Research Institute (ATRI), the average cost of truck operation has increased by about 33 % since 2019 to 2024. In comparison, the contract rate has increased only 17 % in the same period.
Along with the current flat trend, this shows that carriers have largely found their floor in pricing. While some efficiency can still be achieved by using multiple networks against each other, transportation relying on a limited base of carriers, long -term saving opportunities remain.
The rate of point is the floor
Looking at the relationship between the Spot (NTIL12) and the contract rate, the Spot rate continues to provide discounts for those who wish to buy capacity. However, the divergence between the two is noteworthy: the point rate is gradually increasing, while the contract rate remains slightly flat.
In this sense, the point market represents the real floor of pricing – where all operational efficiency has been realized – and that class is increasing.
Spot data is based on broker data targeting smaller fleets and owner operators, while contract data is based on larger fleet factors and larger transportation operations. Thinking about the white line is useful as the rate of use when using 20-30 carrier, while the orange line indicates the use of 200,000 carrier networks. That’s why the point rate tends to be lower.
Dot data is primarily obtained by brokers targeting smaller fleets and ownership ownership, while contract data is based on the factors between the larger fleet and the main carriers. In other words, the white line reflects the condition when working with 20-30 carrier, while the orange line reflects the use of a 200,000 carrier network. This explains why the point rate is typically lower.
FMCSA data shows that the market has lost 100-200 carrier in the past 18 months. Because these data are lagging behind – carriers take time to report or detect disabled – the actual shape is probably greater. This attraction also helps explain the upward pressure on the point rate.
A market in the paving
From the carrier’s point of view, uncertainty still prevails. Transportation has been relatively easy in recent years, but data now suggests that the conditions are becoming more and more challenging-although it is not enough to increase the long-term rate.
Perhaps the larger signal is that despite the constant softness, the contract rate has not significantly declined. This may indicate the hesitation of transportation to push lower costs in an environment that many are unbearable. Many respondents were expecting a significant increase in this phase last year-the expectations that remained intact this year, despite the lack of significant pressure, according to Zac Rogers, author of logistics managers (LMI).
In short, while transportation expects conditions to change, carriers hold a fixed rate to maintain trade. This will continue until it fails. The best recommendation for transportation is to ensure that their high -value lines are higher than point market criteria, as these are quickly out of the day and released as quickly as market conditions change.
In general, a little movement is probably in the contract rate environment, while transportation is unclear about what is in the future. Cost savings may still be found in today’s market, but taking them can increase long -term risk.
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