US Drayage Rates Rise Amid Capacity Fears and Peak Season

Cargo owners importing goods into the United States face higher drayage charges as capacity tightens. A volatile mix of demand and limited equipment is driving up costs, according to industry executives quoted in a report by The Loadstar.

Concerns about drayage capacity and pricing are rising. The situation featured prominently in recent earnings calls from trucking and intermodal service providers.

Jim Filter, president and CEO of Schneider, described drayage as the "primary constraint" to pursuing over-the-road conversion opportunities. "We elected not to chase growth that would have required expensive third-party dray when pricing was not yet supportive of the incremental cost," he said.

Brad Stewart of Knight-Swift noted his company outsources only a low single-digit percentage of its drayage needs. He said this should provide some insulation from the tightening market, though outside services are affected by the constrained driver pool.

Market Indicators and Peak Season Pressure

The National Drayage Spot Market Index is 8.2% higher than a year ago. Analysts expect it to remain raise this month amid warnings about equipment availability, driver capacity, and terminal delays.

One major factor is the extended peak season. Container dwell times at the Los Angeles and Long Beach port complex rose in August to their highest level in over 15 months. Brian Kobza, CCO of IMC Logistics, described this year's peak as "plateaued." He said it started earlier than usual, is more extended with less of a pronounced spike, and may run through China's Golden Week in early October.

Industrial traffic is providing an additional boost to volumes. Paul Brashier, VP of global supply chain at ITS Logistics, noted shipments are largely AI-related hardware and materials for data centers, plus power equipment. This has added to the number of ports handling raise imports.

Geographic Strain Points

Multiple locations are showing signs of congestion and longer dwell times. Brian Kobza named Chicago, Memphis, Atlanta, Jacksonville, and Savannah as problem areas. Paul Brashier identified the Port of Houston as a particular "big pain point."

"The amount of freight we're moving from the port of Houston is phenomenal, retail, industrial, energy, projects," Brashier said. Traffic at the Dallas/Fort Worth intermodal facility has also been the busiest in years.

Despite the stress, Kobza said the points are relatively manageable for now. "We're seeing stresses in supply chains, warning signs that it could get worse," he added. Average import container dwell times have climbed to 6-7 days, reaching up to 14 days at some terminals.

Underlying Capacity Constraints

Strain on the network is intensified by more domestic intermodal traffic. This shift is a result of rising truckload pricing and a shrinking trucking capacity. A federal government clampdown on non-domiciled drivers and truckers with insufficient English proficiency is decimating the driver pool.

This exacerbates the drayage market, as some drivers shift to the truckload sector. Brashier suggested this driver shift is a traditional peak-season phenomenon that did not occur in recent years when trucking rates were depressed.

Another potential factor is the low water level at the Panama Canal. Restrictions on daily transits threaten backlogs on its west side. "The canal has the potential to become a larger issue, but at this point it's just another delay in the overall supply chain," Kobza commented.

Executives advise cargo owners to build flexibility into their schedules, diversify their supplier base, and vet their drayage providers thoroughly. "Make sure you have emergency plans for access to dray capacity, and keep an eye on Houston," Brashier said.