Natural disasters disrupt freight markets in ways that are often misunderstood, leaving supply chain leaders to make high-stakes procurement decisions with limited data. With 75% of U.S. domestic freight moving by truck and annual trucking costs reaching $896 billion, hurricanes such as Harvey and Irma revealed sharp spikes in long-haul inbound spot rates—driven less by infrastructure damage and more by surging demand from relief activity. Yet until now, the true causal effects on transportation pricing remained unclear.
MIT CTL’s Humanitarian Supply Chain Lab applied a rigorous difference-in-differences methodology using real transportation transaction data and FEMA relief records to isolate disaster-driven impacts. The research found that price effects are highly localized—within a 250-mile radius—peaking 2–5 days after landfall and lasting up to 4–5 weeks, with inbound long-haul rates during Hurricane Irma increasing by as much as $1.52 per mile. These quantified insights enable shippers to budget proactively, anticipate capacity competition, and design more resilient procurement strategies ahead of future disruptions.
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The Challenge
Natural disasters disrupt supply chains across multiple dimensions, but their precise impact on truckload transportation procurement remains poorly understood. When hurricanes strike, shippers face simultaneous demand surges for disaster relief and capacity constraints from damaged infrastructure.
During disasters, supply chain leaders lack quantified data to inform procurement decisions, forcing them to choose between paying higher prices for urgent shipments or risking critical delays. Understanding the true causal effects of disasters on transportation markets is essential for building resilience into global supply chains.
Key Insights
- 75% of US domestic freight moves by truck†
- 82% spot rate increase for long-haul inbound trucks during Hurricane Irma*
- 48% increase in long-haul inbound spot rates into the disrupted area due to FEMA relief activity*
- business logistics costs of trucking annually§
§State of Logistics Report, 2023 †Bureau of Transportation Statistics, 2023
†Bureau of Transportation Statistics, 2023
*“Measuring Causal Effects of Disasters...,” Rana, Goentzel, Caplice, 2024
The Research
MIT CTL's Humanitarian Supply Chain Lab, directed by Dr. Jarrod Goentzel, worked with leading transportation data providers to answer a fundamental question: How much do disasters actually disrupt freight transportation procurement, and where? Traditional disaster impact studies rely on anecdotal reports and do not offer a rigorous causal analysis to quantify systemic effects.
The team analyzed actual transportation market transactions for two of the costliest disasters in US recorded history, Hurricanes Harvey and Irma. They leveraged DAT's data combined with complete FEMA disaster relief activity records. By comparing prices in affected zones versus control zones before and after hurricane landfalls, researchers isolated the true causal impact of disasters on spot market rates across different haul types, directions, and time windows.
Meet the Causal Impact Analysis Framework
Developed through a difference-in-differences methodology, our framework allows supply chain leaders to:
- Understand the precise geography of disruption effects (localized to 250-mile radius from hurricane center), enabling targeted procurement strategies
- Identify timing and duration patterns (peak effects 2–5 days post-landfall, lasting up to 4–5 weeks), informing inventory and capacity pre-positioning decisions
- Distinguish demand-driven from infrastructure-driven disruptions, allowing shippers to differentiate short-haul from long-haul procurement risks
The Impact
For supply chain companies, the implications are significant:
- Quantified price impacts enable shippers to develop pre-disaster procurement budgets and model the financial impact of competing for capacity during disasters versus waiting for rate stabilization
- Anticipated recovery windows allow supply chains to model interim sourcing strategies and recovery sequencing for multi-week disruptions
- Understanding the public sector market impact helps private-sector shippers anticipate capacity constraints during relief operations and adjust procurement timing accordingly
Research results:
- $1.52/mile increase in long-haul inbound spot rates during Hurricane Irma for inbound shipments to nodes within 50 miles
- 4-5 weeks duration of broadest long-haul inbound effects after landfall for locations within 250 miles of hurricane paths
- 250 miles geographic radius capturing 95% of causal disruption effects after hurricane
