Recon Logistics - Freight Advisors

Recon Market Update - Jan 13, 2022

Posted by Hank Newman on Jan 13, 2022 3:33:17 PM
market-update-heading
 
Once again, all we hear all day long from many is, "this is unacceptable!!!" We've been preaching for how long now — almost two years? — to expect the "unacceptable." Yet, most still can't figure out that LTL carrier performance is atrocious, and it's not getting better.
 
Folks - this is reality when you continue to shut down the world, so get used to it because it isn't going to change anytime soon. It doesn't matter what your thoughts or opinions are on what we should be doing — deal with the facts on the ground, not what you think is "unacceptable." Do we think the carriers are immune (lol) to everything else that is going on??

More people are not working than ever before — look around your own office. Shipping volume was down 25% last week vs. where it should have been. TL capacity is as tight as it's ever been. Rates continue to set new records. Inflation is soaring (yep — carrier costs are going through the roof). Performance is crashing, and the ports are still congested, etc., etc.

Oh — and we are in bad weather season again. Look at what happened last week along I95. The system just cannot handle these kinds of disruptions anymore. Any delays send shock waves through the stressed network.

Below are some charts illustrating where we are now. So, where are we going in 2022? It appears it's more of the same. We will set new records in rates (maybe not as dramatic as 2021, but still higher). We will continue to see service delays and disruptions. We will continue to be challenged in our workforce capacity, and we will continue to be frustrated.

Sorry to be the party pooper. I wish I could find a silver lining out there in terms of freight costs and service, but I can't.

OH, WAIT - YES - I DO have a silver lining!

It's called Recon's "Smart Select." And it's available in the TMS right now if you actually want to affect your operation's shipping choices on a strategic level to lower costs AND increase service. It's there — right in front of you, but we don't see enough folks acting on it or asking how to use it.  

Let's move from "Unacceptable" to actually taking steps to minimize the forces we cannot control. Help us help you. If not, then just accept "unacceptable." Sorry, not sorry for being harsh, but I'm dealing in reality and fact here.

Charts
Enjoy! Including a new one showing average international container rates, which I think will shock you. 

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Here's an outstanding chart - the Freightos Baltic Index showing average international container rates.  They averaged around $2,000 as late as September, 2020 and hit a staggering $11,109 in September, 2021!

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Tags: Freight Class, Accessorials, LTL, Freight Rates, LTL Carrier Cost, Rules Tariff, Logistics, LTL Service, Limited Access, Freight Technology, TMS, Freight Insurance, Freight Claims, Freight News, Freight Update

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