Demand is slowly returning – a great sign in terms of the economic rebound. However, capacity is still up, which means many carriers are not feeling the effects of increasing demand yet. The Outbound Tender Rejection Index measures the percentage at which tender is rejected by carriers in regard to available capacity. Currently, it is at the lowest point in the history of the index, indicating that carriers are still looking for more cargo to carry. Continuing on unprecedented trends, tender volumes for loads originating in Texas is up 42% while California freight demand is down 17% since January 2019.
It is heavily speculated that the reason for this change is the result of shifting imports to the U.S. East Coast that occurred late last year due to severe port congestion in the West. Unfortunately, carriers overall are not presently seeing signs of improvement in their day-to-day routine. In order to keep truck drivers secure in their work, most carriers are moving freight almost indiscriminately. Until tender rejections reach a trend above 8% (it’s currently at less than 4%), it is unlikely that any carrier will feel optimistic about the freight market’s direction.
