It’s another Monday and the SONAR team is ready for another “SONAR Indices & Insights”. Each Monday, you’ll learn about another index found within the freight forecasting platform from FreightWaves, SONAR. This week we’ll focus on the Head Haul Index and how when you understand this index, you can get a sense of capacity in certain markets or in specific lanes. Using the MAPS view, you can quickly get a birds eye view of various markets in North America, quickly.
In the image below of the Head Haul index maps view, it shows that trucking capacity remains tight in the Southern California, El Paso, Cape Girardeau and Savannah markets as outbound freight volumes exceed the amount of inbound trucks into the market, elevating spot rates for on-demand capacity.
Read past the image to better answer the questions, “What is the Head Haul Index & how does it work?” as well as what historic outbound volumes in the truckload sector mean for freight market participants.
The Headhaul Index (HAUL) calculates the difference between the Outbound Tender Volume Index (OTVI) and the Inbound Tender Volume Index (ITVI). The Headhaul Index will calculate the difference between the two indices, and therefore, the difference between outbound and inbound volume in markets.
Example: OTVI.ATL was 250 as of August 1. ITVI.ATL was 200 as of August 1. HAUL.ATL would be equal to OTVI.ATL (250) minus ITVI.ATL (200), HAUL.ATL = 50.
HAUL is also available in the tri-delta form in each market.
HAUL by equipment type
Exclusive HAULs
The Head Haul Index is perfect for anyone who is interested in freight movement patterns such as shippers, brokers, fleet managers, executives of transportation companies, and owner operators.
The higher the rating, the more of a head haul (potentially undersupplied) market it is.
WHAT DOES HAUL DO?
The Headhaul Index is a good indicator of freight capacity changes. For example, if the spread between OTVI and ITVI increases, it could indicate capacity may be decreasing. This is a good way to evaluate change in available capacity over time.
Example: A user wants to see the headhaul index for the Albuquerque market. They would type HAUL.ABQ
Capacity remains tight in the Southern California, El Paso, Cape Girardeau and Savannah markets as outbound freight volumes exceed the amount of inbound trucks into the market, elevating spot rates for on-demand capacity.
When you know the Head Haul Index reading of each of your critical markets and lanes, you can get an indication of what your costs on those lanes will be and how many resources you need to deploy to get those loads covered as a shipper or a broker.
If you are a carrier looking to get some backhaul (more outbound) or head haul (more inbound) business, you can use the Head Haul Index, in correlation with the Outbound Tender Volume Indices or the Inbound Tender Volume indices to get a very clear picture of where to deploy assets and increase utilization.
In addition to these key markets where capacity remains tight, accodring to Seth Holms of FreightWaves.com, he states the following:
“The Outbound Tender Volume Index (OTVI) climbed another 3.3% this week to a new all-time high of 15,830. OTVI has posted a string of consecutive all-time highs for many weeks now. Freight volumes as measured by OTVI (including tender rejects) are now 50% above 2019 and 58% above 2018.”
SONAR is the first-of-its-kind, lightning-fast freight market data and analytics platform—designed to give users the most comprehensive view of the freight markets and trucking capacity available in the industry today. Shippers, Brokers, 3PLs, and carriers can react faster than ever before. Click the button below to get a demo!
