Rising Transportation Costs and Freight Disruptions
Updated: Aug 19, 2020
Freight imbalances push prices higher in the trucking industry. Still disrupted by the ongoing pandemic, many freight forwarders witnessed price increases in the truckload market. When reviewing how prices have increased in August 2020 compared to March 2020, we can see that prices have gone up by 233% across the board for freight rates.
Rolling into August, the trucking industry is facing another challenge - the record-setting Atlantic hurricane season. With Hurricane Isaias setting precedence, the National Oceanic and Atmospheric Administration (NOAA) is predicting many more records may fall in the coming months as the Atlantic hurricane season is expected to produce at least 10 more named storms.
Hurricane season inevitably brings the risk of disruptions to supply chains. With hurricanes, freight movements are typically affected in a few stages. Before the storm, if predicted in advance, shippers and Federal Emergency Management Agency (FEMA) rush to move freight in and out of the area so truckload rates rise sharply. During the storm, nothing moves in or out of affected areas, and after the storm is over, emergency supplies are brought in, thus inbound rates shoot up for a while.
With many complex components coming into play, we can already see more reordered priorities, shifted demands, and diverted trucks. Regardless of how this situation evolves, Synthetic Resources Inc will keep you informed.