Intermodal Spot Rate Pricing Trendline Analysis - Dec 26 2018
Weekly discussion and analysis on the trends in the intermodal spot rate market.
The InTek intermodal spot rate index decreased 4.0% over prior week.
For the week of December 26, 2018, domestic intermodal spot rate index:
- Down 4.0% from prior week
- Down 9.0% from 90 days ago.
- Up 19.4% from prior year.
Lane Stats: 22.8% increased, 52.6% decreased and 24.6% went unchanged.
As the above stats indicate there is continued softness in the intermodal spot market. The majority of the lane decreases were less than 0.5%, but as indicated in previous blogs there has been a number of the high volume "peak season lanes" which had not yet fully participated in the declines that started earlier this month. That changed this week as many of the "peak season" lanes took major declines and their weight within the index drove the steep decline.
We're expecting the weakness to continue in the coming weeks, as is typical for this time of the year. The decline may be a bit stronger than "normal" in the first two months of 2019 year because many large shippers pulled their freight forward into 2018 to blunt the effect of increased tariffs.
Comparison of Truckload to Intermodal Spot Rate
The national truckload spot rate, as reported by DAT, decreased $0.01 a mile this week. DAT reported the national truckload spot rate was $2.07 a mile. Truckload spot rates are up 0.5% from prior year.
The percentage spread between the year-over-year truckload and intermodal cost per mile decreased slightly this week coming in at a 14.9-point spread. The truckload spot market reacts quicker to market dynamics, which has us looking for intermodal spot rates to decline further and tighten the spread over the coming weeks.
Diesel Fuel Comments:
The EIA reported average diesel fuel price of $3.077 per gallon this week, which is a $0.044 decrease over prior week. This is the tenth consecutive week of a decrease.
The diesel price per gallon is up $0.174 or 6.0% higher from the same period last year.
Oil prices per barrel continues its decline this week, with WTI and Brent closing at $45.11 and $52.69 today, respectively. This decrease pushes oil down further, drawing down almost 20% from 2018 highs.
The story is not changing ... slowing world economies, building oil inventory, trade & tariff concerns and stronger dollar.
The EIA's most current diesel price projection for diesel is $3.17 a gallon for calendar year 2018 and $2.95 a gallon for 2019. The 2019 forecast was significantly decreased in its latest projection, which indicates the diesel price market will continue to soften.
The EIA is projecting WTI and Brent oil prices per barrel for 2018 to settle in at the average of $65.18 and 71.40, respectively. The price per barrel projections for 2019 for WTI and Brent are $54.19 and $61.00, respectively.
The full spreadsheet of the historical weekly price moves of diesel full can be found at https://www.eia.gov/petroleum/gasdiesel/.
Graphs listed below include:
- 53' Domestic Intermodal Price Index & Diesel Fuel Prices
- Variance to January 1, 2013 Baseline
- Rolling 52 Year-over-Year Comparison - 53' Domestic Intermodal and Diesel Fuel Prices
- Rolling 52 Year-over-Year % Change - 53' Domestic Intermodal and Diesel Fuel Prices
- 53' Domestic Intermodal and Diesel Prices Quarter-Over-Quarter Comparison