Winter storm still spinning over fast-growing Midwest freight market

Digital highway sign warning of snowstorm.

A winter storm is still spinning over the Midwest, dumping snow across several states. It will be a couple of days before it clears the region, but at least this storm won’t be as disruptive as last weekend’s blizzard that hit some of the same areas.

Midwest-Great Lakes

A sluggish low-pressure system will continue to spin over the Midwest-Great Lakes region the next few days, including the fast-growing Rock Island market near the Iowa-Illinois border. The storm is producing snowfall and freezing rain. Today and tonight, the heaviest snowfall will likely hit places such as Omaha, Kansas City, St. Louis, the Quad Cities (which includes Rock Island) and northern Indiana. Chicago will see periods of snow and rain. Snowfall will continue in most of these areas tomorrow, in addition to southern Wisconsin and parts of Michigan.

SONAR Critical Events and radar, Thursday, Jan. 23, 2019, 11 a.m. EST. Midwest-Great Lakes winter storm threat.

Overall, roads will be slick and slushy. However, outdoor air temperatures at the ground will hover around freezing, with interstate road temperatures at/above freezing. This means not all the snow will stick to the highways, and lengthy closures are unlikely with snow totals of 3 to 6 inches in most areas.

This storm should clear the Midwest-Great Lakes by early Saturday. Roads should be in good enough shape by then for carriers to pick up loads in the Rock Island market. Major weather-related delays for drivers are not likely.

The latest FreightWaves SONAR data, updated this morning, shows outbound tender volumes (OTVI.MLI) in Rock Island have increased 40% since the beginning of the year. Outbound tender market share (OTMS.MLI) in Rock Island has improved slightly from 0.78% in January 2019 to 0.86%, an early indication of a market to target during the 2020 freight season. OTMS measures a market’s share versus the rest of the country.

Outbound dry van tender rejection rates (VOTRI.MLI) have trended upward to 20.23% as spot rates jumped well above contracted rates in the region. Outbound reefer tender rejection rates (ROTRI.MLI) took the opposite path as rejection rates fell to 6.88%, putting spot rates on a downward trend to align with contracted rates in the Rock Island market. Rejection rates measure the percentage of offered loads by shippers that are turned down by carriers for various reasons. Reefers are temperature-controlled trailers.


Mid-haul loads (MOTRI.MLI), 250 to 450 miles, have seen the highest effects as lane rejection rates have jumped to 18.42%, followed by tweener loads (TOTRI.MLI) of 450 to 800 miles at 17.34% and long-haul loads (LOTRI.MLI) of 800 miles or more at 12.02%. With a headhaul score (HAUL.MLI) of 36.81, capacity has tightened in the Rock Island market. The headhaul index is the difference in outbound volume and inbound volume in a market. Larger, positive values indicate more available freight as well as tightening capacity.

Based on the current situation, brokers should search the spot markets for additional dry van mid-haul and tweener loads from the Rock Island market. With dry van spot rates increasing, bid accordingly and keep pressure on carrier rates. Mid-haul and tweener lanes carry the highest volatility in the region, which can lead to higher margins.

Northeast is next

The storm over the Midwest-Great Lakes will move into the Northeast this weekend. The highest snowfall totals of 6 to 10 inches will hit areas of upstate New York and areas just across the border in Canada. Look for lesser amounts from central Pennsylvania and southern New York state to interior New England.

SONAR Critical Events and radar, Thursday, Jan. 23, 2019, 11 a.m. EST. Northeast winter storm threat.

Winds won’t be too powerful in most areas, with gusts staying under 30 mph. However, isolated spots of stronger winds are possible. This storm likely will not affect major metropolitan cities on the I-95 corridor.

Have a great day, and be careful out there!

FreightWaves Market Expert Donny Gilbert contributed to this article.