PRIMO LEADING NEWS
WEEK FEBRUARY 12TH TO FEBRUARY 17TH, 2024
The ongoing effects of the Red Sea attacks on commercial vessels are beginning to threaten the state of the US recovery. For shippers, this delayed impact means that their transportation plans are at risk, and many are in need of new solutions to optimize routes and mitigate rate increases. PRIMO’s omnimodal coverage enables specific rates to help offset rises in other areas and enables shippers to stay competitive whether handling imports or trying to deal with inland drayage or transportation costs.
The West Coast, including California, continues to experience a deluge of precipitation from multiple atmospheric rivers, causing mudslides, avalanches, and more. Shippers with freight in the area should stay vigilant and consider possible alternative fulfillment means. PRIMO is working to reroute freight to avoid these areas and also working to ensure the safety of all team members and shippers affected by this ongoing disaster with our omnimodal solutions.
UPS experienced a decline in volume from its top customers, including Amazon, in Q4 due to a mix of factors such as Amazon’s increased in-house deliveries and shifts to other carriers. This trend may continue into 2024, impacting UPS’s performance. The declining volume also means that shippers are looking to reduce reliance on major carriers in favor of local, regional or even in-house solutions. PRIMO’s extensive network of LTL providers is well-suited to step and help shippers find coverage for that who wish to continue the departure from the Big 3, especially those using subsidies of the Big 3 for TL or LTL service.
The Logistics Managers’ Index reported that transportation prices have increased for the first time in 19 months, driven by retailers restocking inventories post-holiday season, signaling a potential end to the freight recession. In response, shippers must start getting ready to rethink their strategic partners going through 2024. This will be especially true for those in search of LTL coverage as the market evolves.
The national average diesel price increased by 3.2 cents to $3.899 per gallon, marking the first consecutive weekly increase in 2024. This rise is part of a 6.1-cent increase over the past two weeks, contrasting with the fluctuating prices observed in January. Diesel now costs 64 cents less than it did a year ago, with the price expected to average $3.94 per gallon in the first quarter of 2024. These changes in diesel prices add a degree of uncertainty to the future of fuel surcharges in logistics. PRIMO is carefully monitoring such changes to ensure shippers are billed correctly for these and all accessorials across all modes, especially truckload, as costs change.
Companies are increasingly investing in warehouse automation to improve capacity utilization, speed up order cycle times, and enhance picking efficiency amid ongoing labor shortages according to a recent study. The increasing use of automation in this fashion is making it even more critical to stay strategic when sourcing warehousing, not only for regular shipments but when handling transloads, too. PRIMO’s strategic network is built to handle the demand as part of our intermodal coverage capabilities.