February Report: Truckload Rates Fell, Warehouse Prices High
According to the February ITS Supply Chain Report released by ITS Logistics,truckload rates fell while warehouse lease prices remained high
“Contract and spot rates across reefer and dry vans held strong in January before dipping slightly in February,” said Josh Allen, chief commercial officer for ITS Logistics, in a statement. “Available capacity in the spot market continues to ease following mid-February’s rate decrease, though moving averages remained above those of 2024. Macro volumes decreased by roughly 5% but are anticipated to increase for reefers as we kick off produce season.”
According to Truckstop and FTR, dry van spot rates were at their lowest level since late September 2024. Refrigerated spot rates fell to their lowest level since April 2024, and flatbed spot rates continued their general firming in 2025. Furthermore, flatbed spot rates were at their highest level since late October 2024.
Van rates saw marginal decreases in both spot and contract rates heading into February. Reefer rates also saw dips in contract rates, with spot rates decreasing slightly more than those for dry vans. Available capacity continues to ease following last week’s $0.03/mile decrease to a national seven-day rolling average of $1.66/mile, $0.02/mile higher than last year. Volumes were down 5% last week, and DAT's Top 50 lanes confirmed carriers received an average of $1.94/mile when ranked by the volume of loads moved.
“The freight industry isn’t the only sector of logistics experiencing fluctuating prices,” said Ryan Martin, president of distribution and fulfillment for ITS Logistics, in a statement. “Despite a cooling demand over the past two years, warehouse lease prices have remained high due to reduced new construction. This has led to a 4.5% rise in national average asking rents in the fourth quarter of 2024. Warehousing costs are estimated to account for 13% of the total supply chain expenses, while last-mile delivery holds the largest share at 41% of the total supply chain costs.”
A recent GlobaeSt.com report confirmed that mega big box deals have dominated the market, resulting in the number of leases for one million square feet being representative of nearly half of the top 100 leases in 2024. This growth was driven by record-breaking online sales. The report concluded that the demand for mega distribution centers should stabilize in 2025, as occupiers take stock of their inventory needs.
Overall, by January 2025, the U.S. economy continued to expand, with projections indicating growth just above 2% for the year. However, inflation remains a concern, prompting the Federal Reserve to reconsider potential interest rate cuts. Globally, growth is projected at 3.3% for both 2025 and 2026, slightly below the historical average.
“The big wildcard moment for 2025 will be the recovery of business confidence,” said Stan Kolev, chief financial officer of ITS Logistics., in a statement “Uncertainty about how the newly elected U.S. administration will proceed on tax, regulation, and trade policy may keep companies sidelined in 2025. In addition, renewed inflationary pressures could interrupt the monetary policy pivot, with high debt levels having the ability to create vulnerabilities that may manifest themselves suddenly. Furthermore, the ongoing geopolitical issues, including trade disputes and regional conflicts, pose risks to global stability.”
The Brookings Institution confirmed that expected tariffs would cause employment to decline by 0.11% from the 25% tariffs on imports and rise to a 0.25% loss of jobs with retaliation. This will equate to over 177,000 job losses from the 25% tariff, rising to over 400,000 job losses in the event Canada and Mexico retaliate.
