The freight market continues to be characterized by overcapacity, and with private fleets engaging in spot activity more than in past cycles, spot rates remain only slightly above the late-2023 lows, according to the latest release of the Freight Forecast: U.S. Rate and Volume OUTLOOK report.

“Class 8 tractor backlogs are thinning, but retail sales remain above replacement, more than two years after the spot market turned down. This fits the definition of a prebuy to a tee,” said Tim Denoyer, ACT Research’s Vice President and Senior Analyst.

He added, “Through mid-July, rates have exceeded seasonal patterns by about four cents, mostly a temporary boost from Beryl, which hit during a seasonally soft period for the truckload spot market. Storms during stronger seasonality may have a larger impact on rates.”

Denoyer concluded, “Freight market conditions are usually soft in early July, but DAT’s load/truck ratio rose meaningfully in the days following Beryl and have remained stronger than normal seasonality since. Of course, the surge will likely be short-lived. But in our view, a seasonally adjusted DAT load/truck ratio at 7 signals a market closing in on balance, if still not quite there yet. We need to see this measure at an 8 or 9 to push rates up much.”

The DAT load/truck ratio isn’t exactly a scale of 1 to 10. It can go way past 11. It reached the mid-teens in 2017 and early 2018 and the high teens during 2021, peaking above 20.