The impact of Hurricane Harvey, which made landfall in Texas back on Aug. 25, on supply chains and spot truckload rates won’t be fully reflected until next week, according to analysis DAT Solutions, which operates a U.S. load board network.
However, the firm said that “a continuation of unusually high demand for truckload capacity” occurred during the week ending August 26, with the number of posted loads increasing 1% compared to the previous week, while available capacity fell 1.8%.
According to DAT’s numbers, dry van load posts increased 6% as available truck capacity posts declined 1%; flatbed load posts declined 7% while truck posts dipped 3%; and refrigerated or “reefer” load posts increased 5% and truck posts fell 2%.
Reefer volumes continue to tick up, the firm said, with reefer demand being especially strong in the Upper Midwest.
Load-to-truck ratios increased for dry vans (at 5.2 loads per truck, up 7%) and reefers (at 10, also up 7%) but declined for flatbeds (at 26.5, down 4%). That could change this week with relief supplies likely to move on flatbeds, DAT stressed.
National average freight rates, though, were unchanged compared to the previous week, the firm pointed out:
- Dry Van: $1.78 per mile
- Flatbed: $2.18 per mile
- Reefer: $2.07 per mile
In Houston, the average outbound van rate was up a penny to $1.69 per mile, with the bulk of activity taking place before the weekend. Looking ahead, spot rates are expected to rise for loads heading into Houston and staging areas for relief freight including San Antonio, Dallas, and Lafayette, LA.
DAT added that truckers will want to account for delays unloading, road obstructions, and traffic, as well as the difficulty finding loads leaving those markets.
While the national average on-highway diesel price increased just a penny last week to $2.61 per gallon, DAT said fuel prices are likely to rise more in the coming weeks because so many refineries remain offline in the Houston area.
The Texas Gulf Coast is home to 4.944 million barrels per day (b/d) of refining capacity, while the Louisiana Gulf Coast is home to 3.696 million b/d of capacity, according to the U.S. Energy Information Administration (EIA).
According to S&P Global Platts, roughly 2.33 million b/d of that refining capacity remains down due to the storm, but with refiners also cutting rates, that figure is likely much higher. If those cutting runs are at 50% of capacity, that would put the total downed capacity at 3.36 million b/d or 18% of total U.S. refinery capacity.