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Imports and truckload tenders have been moving in near lockstep since mid-May as the U.S. crawls out of the pandemic-induced recession. With elevated import volumes forecast to continue into 2021, this could mean trucking may have a stronger opening quarter even after the traditional holiday peak season ends.

With supply chains struggling to recover after the U.S. and China shut down to flatten the curve in early 2020, consumers did not stop consuming. Looking at the Outbound Tender Volume Index (OTVI), which measures total truckload electronic tenders in the U.S., there was a large spike in March, with the index rising nearly 30% in three-weeks’ time before receding faster than in rose as people hoarded for what they thought would be a few weeks of sheltering in place.

During the same period, total maritime import shipments clearing customs declined beyond the typical seasonal threshold that follows Chinese New Year (CNY) — the drop in imports was compounded by China’s response to COVID-19, with factories closing longer than normal around the nation’s most celebrated national holiday.

This trend continued into the fourth quarter as shippers are still struggling to replenish inventory and keep up with demand. This means goods do not have much time to sit in warehouses before heading to distribution centers with peak retail season looming around the holidays.

Rail loaded container volumes have recovered to 2018 levels, nearly 6% above 2019 in late October out of Southern California. Contributing to the capacity crunch, railroads implemented peak season surcharges in August, basically denying capacity to noncontracted shippers for volumes above expectation off the West Coast, which forced much of the long-haul freight moving more than 500 miles onto trucks instead of on the rails. Freight moving more than 500 miles has a bigger impact to trucking capacity than sub-500-mile moves.

Thanks to low inventory, unexpected demand and tight railroad capacity — a preferred method of transport for many shippers importing into the U.S. for moving across the country — there is little ambiguity between the time a shipment enters the U.S. and when it gets loaded on a truck.

According to FreightWaves’ Ocean TEU Volume Index, total twenty-foot equivalent units scheduled to leave their points of origin over the next week are 59% over last year — a trend that has been in place since August. This freight will not hit the U.S. for two weeks after departure at earliest, and it is showing no sign of slowing.

Source: Freightwaves