Freight market sees Covid-era extremes return

A monthly survey of proviso concatenation managers showed utmost capableness tightening and complaint maturation crossed the freight marketplace successful March, a dynamic past seen astatine “the tallness of the Covid epoch freight boom.”

The Logistics Managers’ Index—a diffusion scale successful which a speechmaking supra 50 indicates expansion, portion 1 beneath 50 signals contraction—returned a speechmaking of 39.2 for proscription capableness and 89.4 for proscription pricing successful March. The 50.2-percentage-point spread was “the highest affirmative inversion since November 2021,” the Tuesday study said.

Capacity stepped 1.8 points little successful March, which marked a 4th consecutive period of contraction. Pricing jumped 12.7 points to the fastest maturation complaint since March 2022.

The study said portion of the runup successful pricing was tied to the Iran war, however, heightened regulatory enforcement (English-language proficiency requirements, non-domiciled CDL restrictions, a crackdown connected ELD providers and forced operator schoolhouse closures) has importantly drawn down motortruck capacity.

The pricing dataset surged successful the backmost fractional of March, expanding from 81.9 successful the archetypal 2 weeks of the period to 94 successful the past 2 weeks. (Capacity stepped down from 44.4 to 36 implicit the aforesaid period.) Small companies (less than 1,000 employees) returned a 92.7 speechmaking for pricing, which was 8 points higher than sentiment among ample companies.

Transportation utilization (62.9) moved 1 constituent higher during the month.

Logistics managers surveyed expect the proscription marketplace to stay precise choky implicit the adjacent 12 months, returning aboriginal readings of 34.9 for capacity, 67.9 for utilization and 93 for pricing.

Inventory levels (54.8) were up 1 constituent successful March. The humble enlargement complaint occurred arsenic companies are again moving just-in-time strategies versus the just-in-case attack utilized amid wide stockouts during the pandemic. By comparison, the inventory scale was astir 21 points higher successful March 2022.

Large firms, which see large container retailers, returned a March 2026 inventory speechmaking of 62.5 compared to nary alteration (50) astatine tiny firms. The study said the scale mean is 59, “suggesting that firms are continuing to beryllium cautious connected inventory buildups.” Also, elevated carrying costs (interest rates and warehouse rents) are forcing companies to clasp little merchandise.

Inventory costs (76.2) continued to accelerate, up 8.4 points from February, with ample firms reporting higher costs (82.8) fixed their higher banal levels. However, tiny firms saw an inventory outgo summation (72) adjacent though their merchandise levels were unchanged.