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US trucking firms experience cargo demand spike, but scary slowdown looms
来源： 编辑：编辑部 发布：2020/04/01 14:10:06
US trucking companies are facing cargo demand spike as consumers stockpile basic goods as coronavirus panic buying grips the nation.
Trucks are now rolling down traffic-free highways and arriving at distributions centres where workers unload pallets and packages while schools, office buildings and shopping malls remain closed.
However, the rampant buying seen at the moment is expected to subside as pantries and cupboards overflow, and demand for other products, such as furniture, luxury items and auto parts will stagnate as people hunker down in their homes, predicts American Trucking Association's chief economist Bob Costello, reported Bloomberg.
"Freight is really strong, and it's because of all this surge in activity around replenishing grocery stores, retailers and pharmacies," Mr Costello said in an interview. "I think April is going to be soft. I mean, very soft."
Heavy purchases of food, medicine and key consumer materials such as toilet paper and bottled water are keeping truckers extra busy for now, and demand for other goods has yet to taper off as people hunker down in their homes, Mr Costello said. But he expects demand to drop sharply in April and May.
Nonetheless, rates have been rising because of the heavy demand spurred by the new coronavirus - a welcome respite after a year-long freight slump.
Trucking rates on the spot market for dry goods jumped 16 per cent for the week ending March 20 compared with a year earlier, the largest weekly gain in 12 months. Rates for refrigerated truck freight surged 15 per cent, according to a KeyBanc Capital Markets report. Spot rates for all of last year dropped 20 per cent from 2018.
Low fuel costs are also giving truckers a boost after oil plunged to its lowest level since 2002.
Loop Capital transportation analyst Jeff Kauffman anticipates that with a strong March finish for freight, the fallout from coronavirus won't show up much in first-quarter earnings reports.
"Clearly, second quarter is going to be scary," Mr Kauffman said. "The question is how fast do we bounce back as we finish the second quarter."
A second wave of freight demand is coming from China as most factories there have already restarted production and will be sending supplies to the US. That cargo could take several weeks to reach US ports as shipping companies just now are returning empty containers to China, and Chinese ports are resolving issues of driver shortages and congestion.
Along with the surge of freight in March, rates have been pumped up because regular contract cargo has been disrupted and the market is being driven by spur-of-the moment freight shipments that are settled in the spot market.
As the US economy slides into recession, there could be another shakeout of trucking companies that don't have time to fully recover from last year's freight downturn. One eventual bright spot will be diminished inventories, which had been stubbornly high for a year, dragging on freight demand.
Trucks are now rolling down traffic-free highways and arriving at distributions centres where workers unload pallets and packages while schools, office buildings and shopping malls remain closed.
However, the rampant buying seen at the moment is expected to subside as pantries and cupboards overflow, and demand for other products, such as furniture, luxury items and auto parts will stagnate as people hunker down in their homes, predicts American Trucking Association's chief economist Bob Costello, reported Bloomberg.
"Freight is really strong, and it's because of all this surge in activity around replenishing grocery stores, retailers and pharmacies," Mr Costello said in an interview. "I think April is going to be soft. I mean, very soft."
Heavy purchases of food, medicine and key consumer materials such as toilet paper and bottled water are keeping truckers extra busy for now, and demand for other goods has yet to taper off as people hunker down in their homes, Mr Costello said. But he expects demand to drop sharply in April and May.
Nonetheless, rates have been rising because of the heavy demand spurred by the new coronavirus - a welcome respite after a year-long freight slump.
Trucking rates on the spot market for dry goods jumped 16 per cent for the week ending March 20 compared with a year earlier, the largest weekly gain in 12 months. Rates for refrigerated truck freight surged 15 per cent, according to a KeyBanc Capital Markets report. Spot rates for all of last year dropped 20 per cent from 2018.
Low fuel costs are also giving truckers a boost after oil plunged to its lowest level since 2002.
Loop Capital transportation analyst Jeff Kauffman anticipates that with a strong March finish for freight, the fallout from coronavirus won't show up much in first-quarter earnings reports.
"Clearly, second quarter is going to be scary," Mr Kauffman said. "The question is how fast do we bounce back as we finish the second quarter."
A second wave of freight demand is coming from China as most factories there have already restarted production and will be sending supplies to the US. That cargo could take several weeks to reach US ports as shipping companies just now are returning empty containers to China, and Chinese ports are resolving issues of driver shortages and congestion.
Along with the surge of freight in March, rates have been pumped up because regular contract cargo has been disrupted and the market is being driven by spur-of-the moment freight shipments that are settled in the spot market.
As the US economy slides into recession, there could be another shakeout of trucking companies that don't have time to fully recover from last year's freight downturn. One eventual bright spot will be diminished inventories, which had been stubbornly high for a year, dragging on freight demand.