A Shipper’s Guide to the Full Truckload Market

What exactly is the full truckload market?

When people talk about the truckload market, they're referring to the over $200 billion industry, which utilizes equipment such as flatbeds, dry vans, reefers, and straight trucks to move full loads of freight over the road. As one of the most common shipping solutions, many businesses rely on it to move their freight around the country. But because carrier supply and customer demand constantly fluctuate, the market moves quickly - making understanding its components critical for anyone who needs full truckload services.

Market conditions are always changing - and prices change with it

In most instances, truckload rates will change based on market conditions. Experts generally refer to the market as "tight" or "soft" to explain the current balance of capacity and demand.

Tight market

When an expert refers to the truckload market as tight, they are referring to a lack of necessary capacity. This means there are not enough trucks in the marketplace to carry the number of loads needed, or conversely, there are too many loads for the number of trucks available. This often creates a bind for shippers as prices go up and capacity gets harder to find.

Suggested Read:Alternative Capacity Options

Soft market

In a soft market, more trucks are available than there are loads to ship. In this scenario, prices generally go down, depending on how soft the market really is. If trucks can still find freight easily, prices usually won't decrease much. But carriers may lower their prices to attract shippers if freight volumes are especially low.

How timing affects capacity and price

The time of year plays a large role in capacity and pricing - both for the market as a whole and for individual shipments. Here's how that breaks down throughout the year:

Quarter 1 (Jan-March)

Q1 is generally a softer market since post-holiday spending is traditionally weak. This means capacity opens up and finding a truck to haul your load may be easier (and sometimes less expensive) than you'll see in other quarters. Winter weather may cause regional capacity disruptions, but those are usually short-lived. Further, the beginning of the Lunar New Year occurs during Q1, which causes a disruption in supply chains across the globe. As a result of fewer containers shipping into many major ports, domestic volumes are depressed, and rates generally fall throughout Q1.

Quarter 2 (April-June) aka Produce season

Q2 typically brings increased truckload shipments in the Southern and Southeastern United States while volumes remain flat or continue to decline from many markets in the Midwest, Northeast, and Pacific Northwest Coast. The increased demand in the south is due to produce season - when the most significant volume of fruits and vegetables move across the country.

It's important to note that produce season is not a general blanket tightening of the market but rather a tightening and loosening along certain lanes. For example, lanes out of Florida or Georgia may see a slight price increase during this time due to the increased demand for oranges, peaches and other produce that's shipped out of these states and into others. However, lanes into these regions also could see a slight decrease in rates because drivers want to be in these states since they know they can easily obtain outbound loads to get home. It may be difficult to find produce-hauling equipment types, like refrigerated trucks, in other parts of the country during this time.

Quarter 3 (July - Sept)

Q3 overlaps with the historical "end" of the Southern produce season as volumes transition to manufacturing and import-driven markets. Some produce transitions from the Northeast, Upper Midwest, and Pacific Northwest, and those markets tighten up compared to Q1 and Q2.

Quarter 4

Quarter four (October - December) generally begins as a soft market across most of the country, but quickly transitions to a tight one as demand increases in early November because many shippers have more freight. As consumer-driven sectors surge in volume due to holiday-related purchases or "retail" season, demand increases and gives drivers more leverage. Further disruptions can occur around the Thanksgiving and Christmas holidays, resulting from fewer drivers on the road, exasperating the already challenging market for shippers.

Learn more about what goes into truckload pricing.

Other factors that affect the truckload market

Additional factors come into play that can impact pricing and your ability to find capacity:

Available drivers

One of the biggest drivers of pricing and available capacity is how many drivers are in the market. Since the start of the pandemic, many companies added equipment and drivers to meet record shipment demand. But as truckload volumes have begun to revert to pre-pandemic levels, shipment tenders have lessened, rates have fallen, and some unprofitable companies have chosen to exit the market. As capacity from those companies becomes unavailable, rates will likely start to go back up.

Fuel costs

The price of fuel is always fluctuating, which can cause fuel surcharges to change. Fuel surcharges are one of the accessorial charges tacked on to your truckload rate (sometimes built into the rate) that comprises the fuel cost for the driver. As prices of diesel rise, so do fuel surcharges, and so does your truckload rate.

Deadhead miles

Deadheads are empty loads (i.e., the driver is transporting an empty trailer). These typically occur when there's an imbalance in inbound and outbound shipment flow, which is common for shipments going to and from remote locations. In these cases, your rate may increase to help incentivize carriers to take the load.

How to find a truck for your shipment

Once you understand how different market factors impact pricing, your next step is to find a truck for your shipment. The solution, more times than not, is to find a freight broker to match your load with the correct piece of equipment that suits your needs. In 2023, an estimated 928,000+ trucking firms are in business, but most trucking companies have less than 20 trucks in their fleet. Due to the business's fragmented nature and difficulty knowing exactly which one to use, a broker can often connect you with the "best-fit" capacity. This translates to you having options when finding a trucking company that suits you best.

Find your personal guide to the full truckload market

The full truckload market can seem intimidating at times, but by finding a trusted partner to guide you along the way, you can easily navigate its ups and downs. With more than 100 years of logistics experience and access to capacity through our owned assets and our truckload brokerage network, MoLo®, ArcBest can help you ship full truckload with ease.

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