The supply-and-demand curve for transportation tilted in the direction of supply this summer and truck rates have been significantly lower than those of a year ago.

“In June, business was strong but in July it took a tumble,” said Lance Dichter, president of LD Logistics, a New York-based truck broker with its headquarters on the Hunts Point Terminal Market. “We are seeing lots of equipment, and volume has fallen off, so the rates are down.”Trucks on the road. Lower gas prices have been a contributing factor to lower truck rates this summer. (Photo by Ryan G. Beckman)

In mid-July, Dichter took out his books and compared the summer of 2014 with 2015 for this reporter. He said a typical cross-country haul is about $1,500 lower this July. And he predicted that more of the same would be the story for the rest of the summer as well. “We anticipate no shortage moving forward,” he noted.

Dichter said California’s summer melon deal is down and so are supplies of several other items, including tomatoes from the same region.

Paul Kazan, president of Target Interstate Systems Inc., which is also located on the Hunts Point Terminal Market in the Bronx, noted the same situation. “Supplies [of trucks] are adequate. Rates never got crazy this summer as they usually do,” he said.

In fact, he noted the top rate was in the $8,000 range for a coast-to-coast haul. That is about 20 percent lower than the peak rate a year ago. Kazan believes it is lack of demand that is causing the softer rates. “I don’t think there are a lot of trucks out there, but we are seeing more shipments on piggyback [trailers on flatcars], so that has decreased the demand.”

In late July, Kazan predicted that August would also bring similar rates as July. Homegrown deals tend to proliferate as the summer heats up decreasing demand for West Coast product. “The next time we might see a shortage situation could be around Labor Day when demand [for produce] picks up as kids head back to school,” he said.

Robert Goldstein, president of GenPro Inc., which is headquartered in Rutherford, NJ, agreed that there have been adequate supplies of trucks for most of the summer with tight supplies only occurring around the holiday periods of Memorial Day and Fourth of July. He said rail transportation used by some perishable shippers has alleviated the demand side a bit, and a typical drop in produce supplies in mid to late summer was a factor as well.

While this transportation veteran is not predicting a short supply situation at a specific time in the future, he said lack of qualified drivers is a systemic problem that could rear its head at any time. Goldstein expects that periods of big supply in the produce industry — often around holiday periods — will continue to result transportation shortages, and he suspects the problem will be more acute in the future. He noted that there does not appear to be a lot of young people entering the transportation arena as drivers. “It’s a hard life and not a lot of people want to do,” he said.

Besides the taxing hours of being a long-haul driver, he said rate fluctuation makes it very unattractive to many who might otherwise consider it. Independent owner-operators, who have been the backbone of the fresh produce hauling business for decades, can only expect good rates when truck supplies are short. When produce supplies are short, truck rates drop and it’s hard to make a living. Goldstein doesn’t see an easy solution to this problem, but he said the lack of driver situation has been continuous — but sometimes it’s hidden under the surface.