Freight recovery from Irma to last months, spike truck rates

Hurricane Irma’s arrival this weekend threatens to roil US supply chains and double truckload spot rates, with analysts and transport providers warning it could take up to six months to recover.

Transportation providers are still reeling from Hurricane Harvey, the Category 3 storm that hit the US Gulf Coast two weeks ago. Category 4 Irma is threatening to tighten road and rail capacity even further, bottleneck traffic into and out of the Southeast, send spot market rates surging, and damage critical infrastructure.

“To say that this is going to have huge impacts and it’s going to be a puzzle for supply chain managers, when everything from Memphis to Charlotte is going to be impacted from high winds and rains, is an understatement,” Mark Montague, industry pricing analyst for DAT Solutions, told JOC.com on Friday. “This is unprecedented.”

The ports of Miami and Everglades in Florida were closed Friday. The ports of Jacksonville and Savannah were still in operation Friday but scheduled to cease operations by Saturday. While preparations for gale force winds are being made at ports farther north in Charleston and Wilmington, North Carolina, there were no imminent closures as of Friday evening.

The full scope of Irma’s impact on rates won’t be known until next week, but spot rates, largely inbound to areas within the storm’s path, are anticipated to jump as high as, if not higher than, they did during Harvey.

“You probably heard some rates like $5 per mile or that rates were tripling. Certainly some of those could be true. I heard some of those as well,” said Montague. “But overall, rates from say the Dallas-Fort Worth area into the Corpus Christi area were up maybe two times up to $4.55 a mile.”

And those are conservative forecasts. Should the storm not diminish as quickly before it reaches the Southeast’s major inland distribution centers of Atlanta; Greenville, South Carolina; and Charlotte, then Irma will threaten both the region’s primary corridors for commerce but also relief efforts, delaying any type recovery for months.