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Inside Freight
Inside Freight breaks down the complex world of logistics into simple, practical conversations. Each episode explores the realities of moving freight, from preventing problems before they happen to building trust across the supply chain.
Inside Freight
How to read freight market data like an insider with FWF Director of Analytics, Matthew McGavin
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What freight market data should brokers actually be paying attention to, and what's just noise?
In this episode, FWF Director of Analytics Matthew "Shooter" McGavin walks through the freight market indicators that brokers should be tracking daily, weekly, and monthly. He explains how to translate that data into meaningful conversations with shippers and carriers and shares his personal favorite underrated indicator. Matthew also covers why two brokers can look at the same data and walk away with completely different takeaways.
If you're a newer broker trying to make sense of freight data, this episode gives you a practical starting point.
Inside Freight is produced by Fifth Wheel Freight, a third-party logistics provider based in Grand Rapids, Michigan, offering truckload, LTL, drayage, rail, over-dimensional, and expedited freight services across the US and Canada. Learn more at fwf.com.
Are there any data that you like to look at? Data that maybe not every brokerage is looking at.
SPEAKER_02Yes.
SPEAKER_01Now welcome to Inside Freight. Welcome back to Inside Freight, I should say. Today we're going to talk about freight market data, kind of just how to interpret it, how to really read it like an insider, like somebody who's been in the industry for 10, 15 years. If I'm new to the space, if I'm a new broker, new to a brokerage, what are some data points that I should really be paying attention to on a daily weekly basis?
SPEAKER_02Daily weekly basis, I think a key metric type to look at is supply and demand balances. Kind of give you an idea of the shipper's need for you as a broker, the carrier's willingness to take a load at a certain rate. So there's metrics like sonar's tender rejection index is a great one that they developed. Okay. It can tell you truly a carrier's willingness to either take a load or reject a load. And then DAT's low to truck ratio. That's a weekly index, so it's a little slower. But from week to week it does a great job of telling you current conditions are like in a certain, you know, in the national market or in a certain region.
SPEAKER_00Yeah.
SPEAKER_02And like I said, it gives a great idea of, you know, the shipper's need for you as a broker and then the carrier side of it.
SPEAKER_01Right. What's the difference between, you know, okay, I go read all this market data, kind of take it in. What's the difference between that and like really understanding it and how I like utilize it to impact my day-to-day decisions as a broker?
SPEAKER_02One of the greatest ways that we can use this market data is through conversations with shippers. Being able to not just read it and be able to say the market is tight right now, right? Versus being able to justify that to your shipper.
SPEAKER_00Right.
SPEAKER_02Or to be able to listen to your carrier options and hear their opinion on tightness in a certain area.
SPEAKER_00Right.
SPEAKER_02Um, just being able to translate that into a meaningful way that can help the players in the market.
SPEAKER_01No, that that makes a ton of sense. Yeah, being able to explain not only, okay, yeah, the market is tight, but here's why it's tight and here's what that means for you as a shipper or you as a carrier in rates and all that. So yeah, no, that makes sense. What do you see as some of the most commonly referenced freight market indicators? You kind of touched on them a little bit at the top, you know, talking about low-to-trek ratio and tender rejections and things like that, but any others that you feel like a lot of the big players in the market are using as those market indicators on that like weekly or even monthly basis?
SPEAKER_02Yeah, there's going to be kind of some key supply and demand metrics that are very macro. Tender volumes, another sonar metric, high level that's going to make a lot of headlines if we're starting to post year over year increases. That will be demand side. And then there's some supply and demand balance indicators. The logistics managers index has a couple sub-indices. One is going to be transportation costs that will update monthly. And then another one is supply and transportation capacity. Um, it will tell us the direction of capacity in the market. Those are some high-level ones that you know executive teams will be looking at to determine the direction of those. Right. That will help kind of build a lot of high-level decisions.
SPEAKER_01Are there any data that you like to look at that it's maybe more, I don't know if underrated is the right word, but data that maybe not every brokerage is looking at. Maybe it's more fifth wheel specific data or it's just data that's interesting to you. Doesn't have to be the biggest freight market indicator of all time, but something that you think is maybe a little underrated that's kind of fun for you to look at.
SPEAKER_02Yes, the the manufacturing PMI, they have a monthly report on the direction of manufacturing, new orders, production, inventory. And one of my favorite things to look at is they will have some survey responses underneath the report and they will list the commodities that push that in one direction or the other. Okay. So when I see a lot of fifth wheel freight commodities pushing that in the right direction, that gets me a little bit excited, and I can kind of attribute that to hey, this is not only helping manufacturing, but this is like a key fifth wheel commodity.
SPEAKER_01Yeah, no, that makes a ton of sense. Why do you feel like you know, two different players in the market, whether that be like broker shipper or just like two different brokers, will look at the same data and kind of interpret it and utilize it differently?
SPEAKER_02Two brokers can have their own expectations for data and they you know they might want to pull out you know their own meeting, like fifth wheel might have certain commodities that we hope are driving up manufacturing more than more so than others, or what type of infrastructure investment is driving that change. So there's multiple different ways to look at the input factors for an increase or decrease in a metric, and depending on who you are, you will say different things to kind of build expectations.
SPEAKER_01We kind of already talked about the the data points that you feel like are most useful on a daily, weekly, monthly basis. Is there any data that you feel like is just kind of noisy and clickbaity that you might see like on LinkedIn a lot or whatever that's not really like giving us something to work with?
SPEAKER_02The past couple years, one that was talked about a lot was the carrier authority number from the FMCSA, just as a very high-level supply side metric. And it followed the general trend, the general expectation of supply leaving the market, so everybody wanted to just touch on it. Got it. But it was it was kind of stale data, you know, it's number authorities expiring 12 months late, um, and it doesn't tell you the true number of drivers within each authority.
SPEAKER_00Right.
SPEAKER_02Um so I, you know, I would read it and I would touch on it, and like, yeah, that makes sense, you know, we're still declining, but there's a missing piece there. Yeah. And it always left us wondering more, you know, it's just not a true supply side metric.
SPEAKER_01Sort of a take it with a grain of salt type of piece of information.
SPEAKER_02Yeah, you would be concerned if or you know, you would assume direction of it changed suddenly, then that would be worth looking at. But yeah, hey, you couldn't put too much, you know, into that.
SPEAKER_01Yeah, no, fair enough. How do you recommend brokers balance all this national data that's available to us with our internal historical data in terms of making decisions on rates or just general business decisions on a day-to-day?
SPEAKER_02The macro data is great for having conversations with shippers and our carrier options. That's going to go a long ways just to kind of build a relationship and be able to communicate that. Our internal data is great at telling us what our personal strengths are at Fifth Wheel Freight. Right. Um, we use that a ton and we use that to kind of tell us what kind of manufacturing data we should look at or construction data we should look at. And on an individual rep broker level, yeah, what they see on the ground, you know, kind of conversations with their shippers and their carrier options, that's almost the true market, what they can truly cover a load for is almost more important than kind of the macro pieces at some point.
SPEAKER_01Yeah, no, that that makes sense. Is there anything else that you would tell that new broker that's trying to really understand how to how to read freight market data? Tips, tricks, advice outside of like, hey, just look at these few things, but just any any other pieces of advice that you'd give someone in terms of how to really understand this complex data.
SPEAKER_02Yeah, so we talked about how the freight market is determined by many different sectors of the economy manufacturing, construction. Starting with the ability to kind of understand what affects those can get you a long ways in the freight market.
SPEAKER_00Yeah.
SPEAKER_02The DAT weekly blog is a great resource for that because they touch on what manufacturers are seeing, what construction customers are seeing.
SPEAKER_00Yeah.
SPEAKER_02Rather than starting at the broker level sometimes. And being able to take that and apply it to your understanding of what's happening at the macro level.
SPEAKER_00Right.
SPEAKER_02Yes, I know that market is tightening because of a really strong search to 2026 from manufacturing can kind of give you the the what and why. Right. Um and DAT blogs, like I said, are a great resource to kind of get that first, you know, level of information.
SPEAKER_01Right. Make you feel a little bit more educated and like you know what you're talking about when you go to a shipper.
SPEAKER_02So yeah, especially if it's your type of shipper that they're talking about.
SPEAKER_01Yeah, absolutely. Well, thanks. I learned a little bit of something myself today, so I appreciate it. And hope someone else did too. Thank you. Thanks for listening to Inside Freight by Fifth Wheel Freight, where we break down the logistics topics that matter to brokers, shippers, and carriers. FWF is a third party logistics provider headquartered in Grand Rapids, Michigan, specializing in truckload, LTL, drainage, rail, over dimensional, and expedited freight across the US and Canada. To learn more, visit FWF.com or follow us on LinkedIn, Instagram, TikTok, or YouTube.