Focus on Logistics
By Cain Adams
Trinity Logistics Boise Office / Longboard Logistics, LLC
It’s a moment to consider the dynamics of our logistics industry. Lane changes can dramatically impact freight costs overnight and managing shipments out of onion and potato-growing regions becomes particularly tricky this time of year. For instance, carriers are searching for backhaul freight into California to reload those sought-after California produce loads. However, as we approach this period, California loads are starting to dry up, making the round trip more challenging.
This scarcity is causing spot market rates to fluctuate significantly. Today, carriers might ask for $200 more than they did yesterday, and by tomorrow, that amount could increase by another $200. By the end of the week, rates could climb $1,000 higher than they were just a week ago. This pattern is also affecting areas like Washington and Idaho, where the supply of trucks is struggling to keep up with the volume of produce.
When these rate increases occur, it’s not uncommon for customers to shift from a reefer to a flatbed or Conestoga. If the receiver is okay with this switch, it can save $1.00 – $2.00 per bag on freight. Keep this in mind between now and October 15th
Brokers don’t always see a profit on every load. Sometimes we offer a rate knowing we have a truck lined up. Other times, we commit to loads based on agreements with our regular carriers, only to face unexpected changes. For example, yesterday we committed to covering four loads after confirming with a trusted carrier who had four loads going to Idaho. After booking, the carrier informed us that their loads had been canceled. What do we do as brokers? We honor our commitments, even if it means covering those loads at a loss of $450 each. Integrity is key in these situations, and it’s one reason why we love what we do, despite the risks.
This week, I encourage everyone to review your lanes and plan for the upcoming month. Consider factors such as weather, ongoing fires, and the availability of brokers and carriers. A proactive approach will help you stay ahead.
We’ve been fortunate with less hurricane activity, stable rates, and consistent fuel prices over the past year. However, we’re now seeing rates start to rise. Flatbeds and Conestoga’s are being used across all lanes to maintain stability, though this may change around October 15th.
Life is good, and change is inevitable. Be prepared and plan accordingly. We hope you have a fantastic season and keep those smiles on. The transition from summer onions to storage onions is looking promising and has been smoother than anticipated. Remember, many of us are here to support you.
On this September 11th, as we reflect on the significance of the day, I want to remind everyone of the challenges this great country has faced over the past 300 years and where we are as a nation. Change happens and it is not always in the direction we want it. Yet, as a nation, we press forward, and we evolve. We are American. All of us. Stand tall and stand together.
Cheers and enjoy an onion!
