Rate Forecast

The motion-blurred image of a carousel that graced the cover of the January Freight Rate Outlook issue of Logistics Management (LM) could easily be reprised for our Global Issue this month. The idea of static elements going round and round in what feels like an endless cycle could be the illustration that best summarizes our current global environment as well.

Get ahead of the game with our panel of analysts, discussing freight transportation rates and capacity fluctuations for the coming year. Join us now!

Our annual gathering of freight transportation industry analysts reveals some common themes, largely around the notion that rates are not likely to increase much—if at all—in some modes and will continue declining in others. Does this mean things are stabilizing?

Irrespective of mode, rates will be escalating, with carriers controlling capacity and exercising leverage like never before. Given the shortage of manpower and labor pools across the spectrum of global logistics, managers will be struggling this year.

In this annual webcast, executive editor Patrick Burnson hosts our panel of fuel, trade and logistics experts who share their insights on rate patterns in all the major transport modes in an effort to help shippers prepare their freight transportation budget for the coming year.

Freight transportation providers responded to COVID-19 pressures heroically, becoming leaner, more collaborative and efficient. And while this is good news for the nation’s freight network, shippers should expect significantly higher rates across all modes in the months ahead as the world moves through recovery.

Pricing across the transportation modes

In 2019, the world economy will enter a third straight year of broad-based growth, but many economists feel that a combination of rising interest rates and ongoing trade protectionism will continue to create unexpected turbulence—and lead to even higher freight rates. How likely is this to derail the ongoing global expansion?

Indeed, it’s rare that we find a year when global trade has such an unsettling effect on domestic inventory levels, port volumes and capacity demands to handle the influx at those gateways.

Oil prices will continue to face upward pressure, and—perhaps even more importantly—oil prices will become even more sensitive to geopolitical disruptions. Oil and Gas Trends 2018, Energy Prices 2018, Supply Chain Fuel rates, Trucking Fuel

Trade and transport analysts see rates rising across all modes in accordance with continued expansion of domestic and international markets. Economists, meanwhile, say shippers can expect revenue growth in transport verticals to remain in the 3%-plus range.

After the strong upwards correction of freight rates witnessed in global ocean container transportation during 2017, the question now is whether the trend will continue for another year or whether rates will stabilize.

A prominent industry analyst has observed that that 2018 is expected to be a much better year for railroads and shippers who rely on them.

Trade and transport analysts see a turnaround in last year’s negative market outlook, but as global GDP continues to gradually strengthen, carriers in all modes will be challenged to manage capacity while maintaining service levels. Furthermore, sudden shifts in trade policies and agreements may also have an impact on rates.

Trade and transport analysts see a negative market outlook worsen, though some contend that this trend could be reversed later in the year. Meanwhile, logistics managers should brace for a volatile period of rate fluctuation.