Surprising Surge: Trucking Spot Market Rates Climb Overnight

By Craig Fuller, CEO of FreightWaves

There’s something happening here
What it is ain’t exactly clear
There’s a man with a gun over there
A-telling me I got to beware

That’s the song that’s playing in my head as I try to make sense of what I’m seeing in the freight market.

The spot market heat map in SONAR, which tracks sudden shifts in spot market rates, has turned extremely blue, indicating that spot rates are suddenly surging well beyond recent trends.

It’s happening all over the country, and it happened overnight. What makes this unusual is that a sharp market development such as the one we’re currently experiencing is happening without tender volumes or rejections indicating market stress.

In fact, trucking volumes are anemic, and tender rejections are sitting at 5.5%.

As we continued to investigate, our channel checks confirmed what we’ve been talking about for months: the administration’s recent immigration enforcement efforts are starting to have a significant psychological and behavioral impact on immigrant truck drivers and carriers that hire truck drivers with questionable immigration status.

In an article in the Serbian Times, an immigration lawyer warned Serbian truck drivers to stay off the roads for fear of being detained or deported, risking a permanent ban.

He says, “I advise my clients who drive trucks that even if they have a valid work permit, they should not go on the roads.” The article describes that being deported might not be the worst thing. He goes on to describe dire conditions in immigration holding cells and, because of the significant backlog of cases, that hearings may be postponed indefinitely and bail is unlikely, so they may stay behind bars for a long time.

The question on everyone’s mind in trucking is whether this is a temporary blip or the start of a spot market squeeze that could result in much higher rates and a capacity scramble.