As supply chain disruptions from the coronavirus spread across the globe, freight capacity and oil demand could be volatile in the near term. During this time of market uncertainty, it is important to partner with a trusted 3PL, such as Red Kite, to find reliable coverage for your load. Here are the top metrics and headlines our team is watching this month.
ATA Tonnage Index: 117.4 (January 2020)
Trucking tonnage rose 0.1% in January amid soft manufacturing activity. Tonnage is up 0.8% compared to the same time a year ago and has increased 0.6% over the past two months.
Diesel Fuel Price: $2.890/Gallon (Week of 2/17/20)
The U.S. average retail price of diesel fuel dropped 2 cents a gallon in mid-February. Diesel fuel costs 11.6 cents less than it did the same time a year ago.
DAT Dry Van Spot Rate: $1.87/Mile (January 2020)
Dry van spot rates dropped month-over-month in January. However, experts believe rates may have hit their bottom in the near term and may be on the rise ahead of spring.
DAT Flatbed Spot Rate: $2.17/Mile (January 2020)
Flatbed spot rates increased month-over-month in January as higher oil production and construction of the Keystone XL Pipeline increased flatbed demand.
Trucking Industry News
Coronavirus Impacts on Global Supply Chain
The deadly coronavirus could have a significant impact on freight volume entering the U.S. from China. Wuhan is a major industrial and transportation hub, and production disruptions may cause supply chain disruptions across the globe. Due to both the coronavirus and trade tensions, analysts expect the U.S. to see softer freight volumes in Q1 of 2020.
Oil Demand to Decline for First Time in Decade
The International Energy Agency expects oil demand to fall in the first quarter of 2020, which would mark the first quarterly fall in a decade. Demand in the first quarter is expected to fall by 435,000 barrels per day compared with the same period a year ago.
Trump Signs USMCA Agreement, Ratification Progress Continues
At the end of January, President Trump signed USMCA into law. USMCA, which replaces NAFTA, includes tougher rules on automobile production. While Mexico and the U.S. have ratified USMCA, Canada parliament is still in the ratification process.
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