Posts Tagged “trucking rates”
Trucking produce rates set some historic highs during the summer. While rates have declined since then they still remain will above the level of 2017.
For example, Mexican citrus, watermelons and vegetables crossing into the Lower Rio Grande Valley of Texas were $4800 to $5000 in mid August compared to $7800 to $8500 in the middle of June.
Salinas-Watsonville vegetables and strawberries were grossing $9100 to $10000 in mid June to Baltimore, but has dropped to mostly $8,100 in mid-August.
Washington’s Yakima Valley apples, pears and stone fruit were grossing about $8200 to Boston in mid-June, off from about $7,800 in mid-August.
While rates have come down from mid- and late June peaks, they have stayed high compared to previous years.
Historically, summer produce rates reach a peak in May or June and start tapering off in July. This year was no different. Historic peak rates in June of $2.70 per mile had dropped to $2.59 per mile in July, which includes fuel surcharges. Still the July 2018 produce trucking rates were 25 percent higher than the same period in 2017.
With the close of August no serious truck shortages from major produce shipping areas were being reported. August rates were averaging $2.50 per mile, which was still higher than any period on record prior to this year.
Close observers of truck rates believe rates will continue to remain higher than in past years with reasons ranging from higher wages for drivers, ever increasing truck regulations, and a soaring economy with low unemployment. Additionally, there’s more competition for trucks from dry freight with the improved economy.
With the arrival of fall comes additional demand for equipment due to back-to-school activities, Halloween and demand for perishables from foodservices entities ranging from restaurant chains to school cafeterias. Fall crops ranging from apples to pumpkins and potatoes also increase demand for trucks.
While truck rates typically decline overall in the fall, some observers believe rates will remain higher, perhaps as much as 20 percent for the same time a year ago.