It's official, we are in a serious downturn in rates

[Mike]

The region you are in will dictate how bad you are currently feeling this, but with that said, think long and hard about where you are willing to operate at this point. Also, think long and hard about "how" you may need to operate for a while.

I'm currently out west. Southern California market is showing strong, Phoenix market is showing to be pretty average. I'm sitting here in the middle between both of them. Not really in either market, but not really outside of either market. 150 miles in either direction puts me right in the middle of each.

That said, rates suck. I had no intention of running yesterday after unloading (ran from 0130-0800 to make delivery). Figured I would spend the rest of Thursday lining out a load for Friday to run over the weekend with. Went to bed last night with no load and very frustrated, LOL. Hoped this morning would be better, still here scraping through the load boards. I could have a load and be running, but barely above a break-even rate.

While sitting here waiting on something worthwhile, I have also been scanning freight in potential destinations. There is a serious drop in rates virtually everywhere.

It is literally going in the opposite direction of where it should be going right now.

Lots of potential reasons for this, and the foolish way is to focus on one thing and try to drive that home as the only reason that the market has turned.

Rates have been inflated for quite some time, that's one reason.

Warehousing has increased all over the country, this is likely changing the landscape of the "just in time" freight we have been accustomed to for several years now.

Economic fears. Fear of war and fear of continued inflation could be tightening the financial belts of households around the world. Buy less stuff, less stuff to transport.

The downturn has been sharp, which traditionally indicates the upturn will be quick and sharp as well. That said, nothing has gone as planned for a few years now, and nothing indicates that anything will go as planned.

 

[mndriver]

Pretty much why I’ve been hammering some of my maintenance issues out and getting situated so it’s less of a constraint

 

[gearjammer]

I have been looking at the markets lately and things don't look good for anyone,
a friend of mine farms 400 acres and his fertilizer bill last year ran 52 bucks an acre today he is looking at over 200, and even at that price he has so far been unable to secure what he needs,
It isn't just trucking that is getting hammered the farmers are getting hosed with fertilizer, fuel, maintenance,labor costs that are reaching the stratosphere

unless things change drastically people are going to look at the great depression as the roaring 20's in comparison

and it all comes down to THE root cause, THE WAR ON FOSSIL FUELS


people are using up their reserve cash and are now tightening their belts and will be buying a lot less, trucking has seen this a lot over the years think back to 2007 when things were great and then remember 2008 when the bubble burst, same thing is going on now only on steroids without an end in site so hold onto your hats it is going to be one wild ride, if history repeats itself the ones that prepare might survive but a huge amount of people are going to go broke
And then history will once again repeat itself, if we are lucky and things will once again get better

 

[mndriver]

We just bought 1/2 a beef and a 1/4 elk. Elk is an experiment for the wife but the price was right. I had the butcher include all of the hard fat for making lard and that’s needed for making pemmican. We’ll have close to 25 pounds of that.

We have meat for 18-24 month now anyway.

Canned veggies are the same way. Pantry is stocked. Staples like sugar, flour and yeast too.

 

[Electric Chicken]

Not much going on here either. I'm picking up my XPO plates and stickers Monday.

It's gonna be annoying to regress independence-ly but the rail has generally been recession resistant in my limited experience with it.

Rates and freight availability make it pointless to shop for a sleeper. Don't need one for rail.

So yeah.

 

[Rigjockey]

We are slow because we can't get the components to make what we need to make so instead we are making what we don't need to make because we have those components and just to keep the plant running and people working.

Yes I am aware that this has nothing to do with freight rates it is just more of a comment on the state of supply chain.

 

[Mike]

We are slow because we can't get the components to make what we need to make so instead we are making what we don't need to make because we have those components and just to keep the plant running and people working.

Yes I am aware that this has nothing to do with freight rates it is just more of a comment on the state of supply chain.

It all factors in. Multiple factors at play bringing us to this.

 

[Electric Chicken]

We are slow because we can't get the components to make what we need to make so instead we are making what we don't need to make because we have those components and just to keep the plant running and people working.

Yes I am aware that this has nothing to do with freight rates it is just more of a comment on the state of supply chain.

I don't have the components to make what I need to make either so I make googly eyes at the hot neighbor instead.

 

[Electric Chicken]

It all factors in. Multiple factors at play bringing us to this.

This. It's a synergy. It's amazing how everything is connected once you think about it.

Other than all those useless office jobs in obscure don't-know-what-they-even-do-and-they-arent-essential in the office parks and complexes.

 

[Electric Chicken]

According to the local community college there's still a CDL driver shortage and they need students. Desperately.

I mean, it's not like they care about the actual market need. They need to keep pushing people through the door. They don't give a crap whether those students get jobs, earn a living wage, and retain it as a career.

 

[Mike]

a friend of mine farms 400 acres and his fertilizer bill last year ran 52 bucks an acre today he is looking at over 200, and even at that price he has so far been unable to secure what he needs,

This was brought up here before Russia invaded Ukraine, and it’s become even more of an issue now.

War in Ukraine and its Effect on Fertilizer Exports to Brazil and the U.S. - farmdoc daily

Joana Colussi, Gary Schnitkey, and Carl Zulauf - Joana Colussi -

farmdocdaily.illinois.edu

While the United States doesn’t import the majority of its fertilizer directly from Russia, Russia is a huge provider of the things needed, and everything being on a global market is going to cost the price of things to hurt, and the supply of things to be limited.

A potential food shortage is being talked about, which is helping jack up the prices of food. That food shortage is likely to reach the United States, and this is the one fear that will shut people down.

We don’t import a majority of our food, but again, global market so prices are going to keep rising. European countries are at huge risk of running out of key food items at this point, and that will make its way to the United States and all of North America.

That lack of fertilizer that brought up this post, only leads to even less food.

The concerns of food availability and price is increasingly preventing people from spending like they normally would.

Less spending = less freight = very loose capacity

No need to look past trucking when it comes to measuring the strength of the economy. We are crashing at a time that should be ramping up, and there are simply way too many things outside of our control happening to contain it as far as I’m concerned.

 

[Rigjockey]

This was brought up here before Russia invaded Ukraine, and it’s become even more of an issue now.

War in Ukraine and its Effect on Fertilizer Exports to Brazil and the U.S. - farmdoc daily

Joana Colussi, Gary Schnitkey, and Carl Zulauf - Joana Colussi -

farmdocdaily.illinois.edu

While the United States doesn’t import the majority of its fertilizer directly from Russia, Russia is a huge provider of the things needed, and everything being on a global market is going to cost the price of things to hurt, and the supply of things to be limited.

A potential food shortage is being talked about, which is helping jack up the prices of food. That food shortage is likely to reach the United States, and this is the one fear that will shut people down.

We don’t import a majority of our food, but again, global market so prices are going to keep rising. European countries are at huge risk of running out of key food items at this point, and that will make its way to the United States and all of North America.

That lack of fertilizer that brought up this post, only leads to even less food.

The concerns of food availability and price is increasingly preventing people from spending like they normally would.

Less spending = less freight = very loose capacity

No need to look past trucking when it comes to measuring the strength of the economy. We are crashing at a time that should be ramping up, and there are simply way too many things outside of our control happening to contain it as far as I’m concerned.

Bullshit!
What we need now is more Bullshit!

I am not well educated, but I can't understand why North America can't make their own fertilizer?

 

[mndriver]

Bullshit!
What we need now is more Bullshit!

I am not well educated, but I can't understand why North America can't make their own fertilizer?

We do.

Don’t fall for the hype.

 

[gearjammer]

Bullshit!
What we need now is more Bullshit!

I am not well educated, but I can't understand why North America can't make their own fertilizer?

North America in general and the US. in particular has been headed down this path for years, back in the 80's the powers that controlled production decided that it was more profitable to outsource our manufacturing base so our governments bowed to big business and made it easy for them yo do so.
it ramped up so bad that we are now to the point that we produce very little of what we need, hell my Wife worked at one of the last shoe factories in the US until it closed,
many of the things that are produced today are made by companies that are foreign owned with the profits leaving our country
for years we were told that it was a good thing and we could look forward to a robust service economy and not have to worry about actually making things for ourselves.
So we shut down our mines, and factories, outsourcing the all this to Countries that quite frankly are not so friendly to us and thought all was good.
well the hens have come home to roost an these Countries are now in the position to take us down and are gleefully doing so and at the moment there isn't a damn thing we can do about it.
even big business is beginning to see the errors of their ways, just last month Intel started to build what will be the largest chip plant in the world just west of Columbus Ohio although it will be several years before it is in production
there is also talk of opening mines to produce a lot of the mines so we are not beholden to other countries mainly China for the critical minerals we need for things in our everyday life, it will be years before they can actually produce what with the over regulation that is in effect today.
we need to have an America first agenda and I include Canada in that equation
the FIRST thing we need to do is secure our energy supplies at a price that is affordable otherwise nothing else will happen
and as far as allowing other countries to come to to our countries and buy up are businesses and lands that needs to stop the one thing we are still good at is raising is food in the 70's when the Arab oil embargo the cry was a barrel of oil for a bushel of wheat and that needs to be the battle cry today
We can become prosperous once again but the bullshit has to stop quickly and we need to have strong leaders that work for the people that elected them that will institute strong laws and cut the red tape

 

[mndriver]

We have lots of capabilities….

7.5.1. Great Plains Synfuels Plant

The Great Plains Synfuels Plant (GPSP) in Beulah, North Dakota has been in operation producing synthetic natural gas (SNG) from lignite coal for 25 years and remains the only coal-to-SNG facility in the United States. In addition to the production of SNG, the plant also produces high purity...

netl.doe.gov

 

[Mike]

Bullshit!
What we need now is more Bullshit!

I am not well educated, but I can't understand why North America can't make their own fertilizer?

We do.

Don’t fall for the hype.

It’s not hype, it clearly says we get very little from Russia.

The problem is this is a global economy, and a lack of supply anywhere raises costs everywhere.

 

[Rigjockey]

North America in general and the US. in particular has been headed down this path for years, back in the 80's the powers that controlled production decided that it was more profitable to outsource our manufacturing base so our governments bowed to big business and made it easy for them yo do so.
it ramped up so bad that we are now to the point that we produce very little of what we need, hell my Wife worked at one of the last shoe factories in the US until it closed,
many of the things that are produced today are made by companies that are foreign owned with the profits leaving our country
for years we were told that it was a good thing and we could look forward to a robust service economy and not have to worry about actually making things for ourselves.
So we shut down our mines, and factories, outsourcing the all this to Countries that quite frankly are not so friendly to us and thought all was good.
well the hens have come home to roost an these Countries are now in the position to take us down and are gleefully doing so and at the moment there isn't a damn thing we can do about it.
even big business is beginning to see the errors of their ways, just last month Intel started to build what will be the largest chip plant in the world just west of Columbus Ohio although it will be several years before it is in production
there is also talk of opening mines to produce a lot of the mines so we are not beholden to other countries mainly China for the critical minerals we need for things in our everyday life, it will be years before they can actually produce what with the over regulation that is in effect today.
we need to have an America first agenda and I include Canada in that equation
the FIRST thing we need to do is secure our energy supplies at a price that is affordable otherwise nothing else will happen
and as far as allowing other countries to come to to our countries and buy up are businesses and lands that needs to stop the one thing we are still good at is raising is food in the 70's when the Arab oil embargo the cry was a barrel of oil for a bushel of wheat and that needs to be the battle cry today
We can become prosperous once again but the bullshit has to stop quickly and we need to have strong leaders that work for the people that elected them that will institute strong laws and cut the red tape

In the late 80's I knew a few people that worked making computer chips. it Payed not too bad and then it didn't pay much at all and then everything got outsourced overseas.
I think for the most part robots assemble computer chips nowadays so bringing those chip plants back onshore should be easy. IMO.

 

[mndriver]

In the late 80's I knew a few people that worked making computer chips. it Payed not too bad and then it didn't pay much at all and then everything got outsourced overseas.
I think for the most part robots assemble computer chips nowadays so bringing those chip plants back onshore should be easy. IMO.

Used to work for a company that made the arm flexible circuit components for hard drives. Company celebrated their 40th anniversary while I worked there. By their 50th, their competitors owned them.

Board of Directors wouldn’t listen to the engineers when we told them to go into SSD drives. Oh well.

Labor, epa, and osha laws had us shipping production overseas as fast as we could ship a certified production unit.

In the states, the air and water discharge was normally cleaner than what we received from local municipalities. We paid dearly if our discharge was contaminated. One incident I know cost us $2.5 million in clean up fees to the city for a 250 discharge.

 

[mndriver]

Seems overdrive would counter your position

Despite record freight market, challenges remain for owner ops

Rising fuel and maintenance costs, coupled with a decrease in miles, kept owner-operator net income levels in check in 2021. More on Overdrive.

www.overdriveonline.com

 

[389 Hood]

Numbers can be skewed to fit an agenda by anyone for the right $$$.