2021 Rate Outlook: Hikes are a certainty

If history serves, this marks the 16th year we’ve offered logistics management professionals our Rate Outlook print feature and webcast (January 28th) combination. Over that time, analytics have shown that it’s our most-read magazine feature and our best-attended webcast year after year—and I can’t say I’m surprised.

Over that time, the premise has remained the same: We kick off the year with a picture of the state of the global economy and fuel costs and then examine how those realities will affect freight rates and capacity levels across each mode of transportation over the coming year. It’s a 30,000-foot few of where costs are heading—and why.

Our master of ceremonies this year is executive editor Patrick Burnson, who once again surrounded himself with some of the leading economic, fuel and freight transportation analysts in the market. As is tradition, he welcomes each of these top sources to the lectern to offer a quick glimpse into the immediate future in an effort to help shippers prepare their freight budgets for the long run.

Before you cement your 2021 planning, first read through our Rate Outlook print feature and then carve out an hour to join our esteemed panel for our webcast that goes live on Thursday, January 28. On that date, you’ll be able to submit any questions you have for our speakers and dig deeper into where rates are heading.

As Burnson points out in this year’s Outlook, we would be remiss if we didn’t first mention the Herculean effort put forth by our nation’s carriers and freight transportation service providers in all modes during the course of the pandemic. Their work to keep essential inventory moving, shelves as full as possible, and vital manufacturing operations up and running deserves to be celebrated.

“Our panel agrees that the response by our nation’s freight network across the board was downright heroic in many instances,” says Burnson. “And if there’s a single, positive consequence that’s come out of this difficult period, it’s the enhanced collaboration between transportation providers and shippers—something that’s been sought by both parties for decades and accelerated by necessity over the past 10 months.”

And while this unprecedented period of time has created the most unbalanced freight environment we’ve ever witnessed both domestically and globally, all hopes are that any newfound carrier/shipper collaboration will continue to blossom and improve efficiency as freight volumes continue to build to historic levels and carriers work feverishly to put needed capacity back into the network.

“I don’t think its news to anyone that motor carrier capacity can’t be replaced fast enough, as spot rates went through the roof during the last two quarters,” says Burnson. “However, our sources don’t see the issue dwindling anytime soon, which only means shippers will be pressed to make sure they’re doing everything that they can to keep their carriers as happy and efficient as possible for as long as possible.”

And while rate hikes are a certainty in 2021, Burnson adds that all parties need to keep their eyes peeled on the oil and fuel markets in the near future as the Biden administration steps into the White House.

“Diesel prices have be steady and reasonable due to the drop in demand,” Burnson adds, “but that could change should any of the recent peace deals in the Middle East be brought into question by the new administration. It’s one more ‘wild card’ that could lead to energy volatility—something we really don’t need right now.”