An ongoing driver shortage coupled with consumer demand will keep spot and contract rates elevated — and could make 2021's first half look a lot like the last half of 2020.
Contract rates exceeded spot rates for the first time in seven months during the last week in January, according to DAT, breaking a remarkable run for the spot truckload market.
"Since the pandemic began in March last year, dry van spot rates increased by almost 90 cents a mile, while contract rates increased by around half that amount during the same period," said Dean Croke, DAT principal analyst. "As a result, shipper freight bids, negotiated in late 2020 during the peak of the spot market rally, resulted in higher negotiated contract rates for 2021 freight."
The monthly average contract rates are up 19% YoY, at $2.25 per mile. That is 41 cents higher than the same time last year, Croke said. Spot rates are now down to $1.98 per mile.
"So the market inflection point for freight rates has arrived," Croke said.