Tender volumes slipped by 2.7% overall this week on a national basis but from a very elevated base. If one looks at the weekly Outbound Tender Volume Index (OTVI) map below, one might think freight markets have reversed course and are retreating significantly. Here’s the OTVI weekly change for select major markets:
Ontario, California: -6%
Atlanta: -4.5%
Indianapolis: -7.5%
Harrisburg, Pennsylvania: -5%
Houston: -3.5%
Stockton, California -8%
(Chart: SONAR; 3-D Map; Weekly outbound tender volume change in %)
But this simply isn’t true. Tender volumes are coming down, but off an unnaturally high base. The winter storms caused an already strained freight market to turn upside down. Routing guides were upended as many major interstates — I-10, I-20, I-40, I-75, I-95, I-24, I-57, I-70 and I-80 — were all shut down for some time.
On the retail front, difficulty in sourcing capacity at the beginning of March may have led retailers to accelerate their Q1 order schedule. If that is the case, shippers may have temporarily pulled forward delivery schedules and caused a non-sustainable large surge in tender volumes. It is this high base from which the market is declining.
Tender volumes in nearly every major market in the country — from LA/Ontario on the West Coast, to Houston, Dallas and Atlanta in the South, to Joliet, Illinois, and Harrisburg in the Midwest and Northeast — remain above pre-storm levels.
The…
