Let the games begin! Produce and nursery seasons are upon us, effecting the supply-and-demand equation beginning in March and playing hard through July. These voluminous freight producers have everything to do with determining spot market conditions and fluctuating pricing. Not only do these two commodities kick off the high demand for equipment, they are also responsible for upcoming price spikes following the "quiet season" of January - March.
The early arrival, or stubborn delay, of spring can affect the timing of any given year’s produce season. How soon the season starts effects capacity and the ability to move the emerging truckloads of early crops such as citrus, avocados, tomatoes, and potatoes. Typically the volume follows the track of warming temperatures starting in southern California and southern Texas along with imports from Mexico. It then follows the elevated temperatures to Florida and up the East Coast. So far, this year’s seasonal surge has proven to be average, with the usual suspects appearing on the scene as anticipated. (Check out our produce compatibility guide quick reference.) .
Dealing with perishable freight is always challenging and produce is no exception. Commodities that need to arrive within a certain window of time create less flexibility and more demand. This, in turn, shrinks capacity and raises rates. This is particularly true of refrigerated and temperature-controlled trucks which are in the highest demand.
In addition, carriers trying to make the most out of the season will position their equipment in produce-heavy shipping areas which puts a strain on those in other markets searching for trucks. This impacts capacity and higher rates across the board.
So what can the average “Joe” shipper do to combat all these variables and cost-driving challenges? The most important thing you can do is arm yourself with knowledge, or market intelligence. If you’re not a multi-million dollar company and don’t have the technology or resources to gather this intelligence, it’s important to work with a 3PL who has the capabilities. Expertise in produce shipping can offer your business additional value by providing enhanced visibility, predictive planning and capacity maps -- all of which can help with your strategy and pricing.
- Forecast and plan accordingly – even if you’re a little off on your calculations, an educated guess using previous year’s data is better than not having any idea of volumes when securing carriers. Having advance notice will give you the flexibility to save costs over last-minute pricing.
- Be a shipper of choice – carriers want to work with shippers who are fair and reasonable. See our recent blog to determine if you are a shipper of choice.
- Explore alternative modes, even if think it doesn’t make sense. You might be pleasantly surprised – get pricing on LTL loads by pricing them as truckload or if the commodity has an extended shelf-life, intermodal may be the unexpected cost-saving answer.
- Find a 3PL that specializes in the latest technology, market intelligence, visibility and superior communication – make that freight broker earn your business! Use them as a consultant, because that is the value-added proposition they should be providing any and every shipper.
Choptank Transport has its roots in the produce shipping market, answering the need of the local farmers in its own rural and agricultural backyard of Preston, Maryland. We know produce like we know logistics. Contact us today for a !
Related links: https://www.vox.com/a/explain-food-america
Related links: Avoid price fluctuations during produce season