How will freight markets change in the new year?
2020 was a turbulent but profitable year for freight markets, with the COVID-19 pandemic causing surging demand for goods as well as high rates across the trucking industry.
2021 brings a new year, new vaccines and a new president into the mix, all of which could impact the market in big ways.
The American holiday season is over but Asia’s Lunar New Year is around the corner and traditionally marks a shutdown period for Chinese factories and shipping. However, as FreightWaves Senior Editor Greg Miller reports, only 2% of ocean carriers have canceled sailings for this year compared to a normal 20%.
Zach Strickland says that the post-holiday season is typically a slow period for freight and that just because your freight has made it into the country “doesn’t mean it will make it on the truck.”
Anthony Smith agrees with Strickland that the Lunar New Year will not have a slowing effect in the United States as companies try to restock warehouses and get delayed shipments out to receivers.
Strickland says the market is “too fast, too furious” at this time and Smith believes import volumes will stay high thanks to tighter supply chains both up and downstream.
Looking forward, Smith believes the housing market will also stay tight this year, close to levels seen “right before the Great Recession.”
As far as consumer trends go, Smith thinks it will be a “tale of two consumers,” with the difference being how they fared during the height of the pandemic.
One thing is for sure: Both Smith and Strickland believe freight volumes will remain high in 2021, even as vaccines roll out and more people pivot spending to services instead of goods.
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