The Ontario Trucking Association is reporting what looks to be the start of a banner year in the trucking industry. With 42% of carriers reporting improved volumes this quarter within Ontario and almost half of carriers reported (48%) that volumes to/from the US increased.
At the same time, TransCore Link Logistics, a leading provider of freight matching services reported opening the year with never before seen highs in load volumes posted on their network. January was reported to be 47% up year over year. Link also reported that transborder postings were up 65% year over year for shipments originating in Canada and up 42% for shipments originating in the US.
It doesn’t appear pricing has taken on a dramatic upswing despite the growing freight volumes. However, signs of rising prices are evident with the OTA reporting that 23% of carriers were reporting higher rates in Q1 2014. This is surprising given that the industry has been in a capacity crunch for years. One would expect this number to be much higher. As the market tightens and capacity is further squeezed, it’s likely there will be more upward pressure on pricing in the months to come.
Diesel fuel costs are back on the rise. After a year of declining prices, the on-highway price of diesel fuel has risen back over $4.00/US per gallon. If rising freight volumes are the sign of a strong economy, the demand for diesel usually goes up and results in higher fuel prices.
Based on the economy regaining strength, and excessively positive signs from the trucking industry in Q1 2014, it looks like the industry is in for a busy and profitable year. High freight volumes will inevitably translate into a capacity crunch, allowing carriers a choice of better paying freight, resulting in on average higher rates and better margins for carriers.
Here at XTL Transport
Here at XTL Transport we’re excited about 2014 and have just been listed in Today’s Trucking as #20 on their Top 100 List of the Largest Carriers in Canada. We’re bullish about the future and are standing by to help our customers get their goods delivered safely, on-time and in an economical matter. If you’re experiencing the capacity crunch this year and haven’t tried XTL in the past. We’re here to help you.