Another Canary

      According to a news article in my internet opening page, perhaps the largest trucking company in the US, Celadon, will declare bankruptcy today.   As many as 3200 drivers may be stranded out on the road.   Most drivers rely on company provided credit cards to purchase fuel.
      As someone intimately involved with the freight business, this information is more pertinent to the economic future than last month's much touted jobs report.   Trucking remains the lifeblood of commerce in this country and a declining transport sector can be expected to impact the wider economy within a few months.
      As a newbie in the produce industry in the early 1980s I was in charge of hiring trucks to move loads of produce around the country.   Produce is a little bit of an outlier as far as trucking goes.   In much of the industry, rates are usually contracted years in advance.  Manufacturers know exactly how much it costs to ship each widget to market.   On the other hand, lettuce shippers in California usually negotiate with truckers on a daily basis for rates to ship their product to market.
      A trip to New York markets which might have cost $5,000 on Friday could possibly cost $8,000 on Monday, simply because there were fewer trucks available.   By Wednesday, the cost could fall again as more truckers "deadheaded" to the area in search of lucrative paydays.  With fewer trucks on the road, these paydays could become much more inviting.  
     I knew when manufacturing in the country had slowed by the number of additional trucks looking for loads of produce to keep the wheels turning.   If today's news regarding Celadon is true, rates for moving produce are likely to fall in the short term.  But for the economy in general, a decline in the number of trucks on the road signals problems in the months ahead.