Is Transportation coming back to “Normal?”

Truck rates are down, ocean carriers are charging less (See graph) and package volume is down. Does this mean we are returning to a more normal time?  My answer is “no.”  There are a number of new and not-so-nice headwinds or factors, affecting supply chain: Lower labor participation rates haven’t gotten back to 2019 levels. […]

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More humping

While 2 unions are threatening a walkout this week, if there isn’t a stoppage, there will be more humping. Even if there is a stoppage, when they come back to work, there will be more humping. Before your mind goes in the wrong direction, humping is a way of sorting rail cars onto trains that […]

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Container arteries constricted

Railroads are limiting container loads into locations like Chicago. Here is why: Inland container yards are full Warehouses are full. Prologis Inc. said the vacancy rate in the firm’s top 30 U.S. markets is 3%—good for them but historically vacancy rates are >5% Chassis are scarce: Direct ChassisLink Inc. said that because of the extended […]

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Are you targeting a payload that is too low?

I advocate weighing the trucks to see where payload targets should be set.  Here is a sample of refrigerated trucks from major carriers in 2021: What does this tell you?   In this sample, which was large enough to be valid, 69% of all trucks could carry more than 45,000# and 77% could carry more […]

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Good news and bad news on Diesel Prices

Good News (Price will go down):  Today: Crude oil prices are way down + refiners’ margins are down by ~50% Future: High prices ~$100/barrel for oil and $9+ for gas mean that economically recoverable reserves rise. e.g. Eagle Ford sees a fifteen-fold increase from 0.5 billion barrels to 8.4 billion barrels  Bad news: Refineries that […]

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The Fallacy of Transportation Contracts

Most contracts read like this: “we’ll give the carrier x lots per year (maybe) and the carrier will accept some of them if they feel like it.”  Sounds like a great basis for a partnership.  So, what is happening: Ocean carriers are refusing contract loads and doing spot loads for others (Source NY Times). Some […]

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