2018 Hurricane Update
The data is clear about four items.
With four weeks of relevant data available, we now have enough information on Hurricane Florence to begin drawing some conclusions. The data is clear about four items:
- Because this storm made landfall in a relatively sparsely settled area, it has had much smaller effects than Hurricane Harvey last year. Consider the contrast between the flooding pictures from Houston last year and those from New Bern, NC this year. Harvey settled over eight-plus million people. Florence hit about one million. As a result, the increase in spot volumes for North Carolina has been about 5,000 loads per day inbound compared to 8,000 for Texas after Harvey. It is probably as well that the increases will be sustained for a shorter period. After Harvey, inbound volumes were still climbing in Week Seven. They are falling (slightly) inbound to North Carolina this year in Week Three.
- The first effects of Florence were apparent a week before the storm made landfall, in the drop in both inbound and outbound volumes. There was no such preparedness a year ago. It appears that the experience of the last two years made supply chain managers wary.
- The data from both years show a distinct preference for increased volumes inbound to problem areas, much more than outbound. The increases are for emergency supplies and restocking of retail shelves. Outbound volumes increased only in Week Five last year and not by very much. You can see from the data here that North Carolina outbound volumes are already back to normal.
- Importantly, there have been no pricing effects so far this year. In 2017 with Harvey, prices jumped by $.40/mile inbound and $.25 outbound. This difference may have to do with the fact that prices are already inflated this year, where they were just beginning to show signs of stress last year. Again, this storm affected fewer people.
- Finally, the national effects, as shown by spot market data, show the same pattern as the local effects. Market tightness is up but only by about one-third of the Harvey effect. Van rates are up slightly, perhaps a fifth of last year’s increase.
As with last year, we have benefited from the revolutionary real-time spot market data from Truckstop.com. It is timely, abundant and geographically specific, a data set of great new benefit to operators and policymakers in the truckload markets.