New Trump tariffs could ‘decimate’ China e-commerce, airfreight demand

Image of an iPhone with Chinese shopping apps highlighted.

The U.S. government dealt another blow to Chinese e-commerce platforms and the air cargo market with Tuesday’s declaration that tariffs on imports from China will be jacked up an additional 50%, jeopardizing demand for their ultra-low-cost merchandise less than a week after duty-free customs privileges were revoked.

As part of his escalating trade war with China, President Donald Trump also imposed more draconian fees on low-value shipments from the country that move through the international postal system.

Trump’s trade actions are “going to decimate airfreight out of China because Temu and Shein’s volumes are going to get hammered” when the rules go into effect on May 2, said Derek Lossing, a former logistics executive at Amazon and founder of e-commerce supply chain consultancy Cirrus Global Advisors, in a phone interview. “Demand is going to dry up. It’s gonna be brutal.”

Trump last Wednesday ended the so-called de minimis exemption and gave notice that postal parcels will face a duty rate of either 30% of their value or $25 per item, increasing to $50 per item on June 1. The stated reason was that the frictionless entry enjoyed by parcels made it easy for criminals to smuggle illicit fentanyl and counterfeit goods into the country. By forcing small-dollar shipments through a formal entry process, the administration says authorities can apply analytics to identify suspicious parcels for inspection.

On Tuesday, Trump hiked the duty rate to 90% and the flat fee to $75. The flat fee slated for June 1 was revised to $150 from $50, according to the executive order. Shippers can choose the percentage rate or the fee route and can change their choice once a month.

Although the amount of the fees is shocking, online marketplaces mostly shun postal services because of slow delivery times. They will be mostly affected by being subject to the new tariff regime, according to logistics experts.

Currently, goods valued at $800 or less and shipped to individuals are exempt from duty payments and detailed documentation for customs clearance. The favorable rules enticed online retailers like Temu, Shein and Alibaba in recent years to fulfill orders from the factory and send them directly to consumer residences instead of shipping in bulk to U.S. warehouses. Many U.S. brands, including Amazon’s new Haul bargain store, have also adopted direct-to-consumer fulfillment from China.

Starting Wednesday, tariffs on Chinese goods will rise an additional 50%, to 104%, as Trump said would happen if China didn’t back down on its own retaliatory tariffs. The new tariff rate stacks on top of 20% and 34% tariffs announced by the administration in recent weeks. Some products subject to tariffs initiated in 2018 could see even higher tariffs, such as medical devices at 225%.

A crackdown on business-to-consumer e-commerce shipments from China has been building for more than a year because of concerns about smuggling and an uneven playing field for domestic retailers selling goods subject to import duty or made in the United States, where costs are higher. On its way out in January, the Biden administration proposed stricter rules on low-value Chinese parcels. De minimis reforms have also gained support on Capitol Hill. But the Trump administration went further and faster, eliminating duty-free treatment for de minimis shipments and using emergency authority to stem the tide of illegal drugs without waiting to complete the normal rulemaking process.

Demand destruction

When it became clear last fall the Biden administration was preparing to change some de minimis rules, consensus in the logistics industry was that the impact on Temu and Shein would be limited because adding $3 or $4 to the price of a super cheap dress wouldn’t deter most shoppers. But the elimination of the de minimis exemption, combined with a massive spike in tariffs, could severely change the business equation for the Chinese players, depending how long Trump sticks with the new trade rules.

The new U.S. tariffs on China mean Americans won’t find the same bargains they are used to at Temu, Shein, Alibaba and other sites. In addition to paying high duties, each parcel will cost $3 to clear customs compared to 10 cents under a special expedited de minimis process currently used by retailers. A dress that cost $30 before will more than double in price under the new rules if all extra costs are passed to customers.

“As soon as Temu and Amazon have price parity, Temu is not going to be as popular,” Lossing told FreightWaves. “Every time you stack on more costs, demand is going to fall. And then you also start slowing down the supply chain because things are going to get caught up in customs searches and airports are going to become congested.”

The vast majority of de minimis shipments move through air logistics channels. Digital markets in China were the primary engine behind double-digit air cargo growth last year, accounting for nearly two-thirds of volumes on the trans-Pacific lane, according to market researchers.

The air cargo sector was already bracing for a significant decrease in business after the White House made clear in February that de minimis would be banned from duty-free privileges, but Tuesday’s order is likely to destroy much more demand for cross-border e-commerce, experts predict. Airlines are likely to lose volume too as large e-tailers return to a B2B2C model that involves shipping by ocean and fulfilling orders from U.S. facilities. Chinese marketplaces, especially Temu, also have the ability to source more from other countries, but pending U.S. plans to update de minimis rules for the rest of the world could undermine the tactic.

Businesses and economists express hope that the massive tariffs on China – as well as many other countries – are simply a negotiating tactic and that Trump will quickly reduce them. If that happens, the impact on e-commerce and air cargo could be less severe.

Amazon recently began listing more brand name apparel on its Haul storefront, The Information reported on Wednesday. When Amazon launched Haul late last year, the storefront only offered unbranded products from outside sellers that shipped to U.S. shoppers from China with delivery times of more than a week. Apparel bought in bulk from brands like Levis ships from within the U.S. with shorter delivery times than the other goods on Haul. In addition, Amazon earlier this month added a browser-based version of Haul, which had previously only been available on its mobile app. The moves are likely to increase Haul’s appeal as a destination for bargains as barriers to Chinese imports increase, the tech news site said.

China has significant postal volumes to the U.S., according to U.S. Customs and Border Protection and e-commerce experts, but they are dwarfed by shipments moved through commercial air and express transport. Mainstream e-commerce brands don’t use postal services to any significant degree because they take nearly three weeks for delivery compared to about a week using logistics providers. The primary post users are small sellers and individuals.

Some trade compliance experts last week speculated that online retailers might shift some volume to China Post and the U.S. Postal Service because the flat fees offered some cost certainty for higher-value orders, but the new Trump fees likely wiped away that option considering that the average de minimis shipment is worth about $50.

Click here for more FreightWaves/American Shipper articles by Eric Kulisch.

Write to Eric Kulisch at ekulisch@freightwaves.com.

Freight industry still lags in technology adoption

Trigent, a technology services organization, recently conducted a survey to assess the technological preparedness and investment priorities of the freight industry. The results, along with insights from an interview with Pratapa Bernard, vice president of strategy at Trigent, showcase both the challenges and opportunities that lie ahead for logistics technology.

The survey results demonstrated that many companies don’t consider themselves fully technologically equipped. While some progress has been made, 16% of respondents still rely on rudimentary tools including Excel spreadsheets and manual phone calls, indicating a gap in digital adoption. Meanwhile, 61% operate with partially automated systems, utilizing a patchwork of disconnected solutions that often lead to inefficiencies and operational silos.

The lack of full automation is not just a technical issue but also a strategic one. Bernard explained that businesses are wrestling with how to integrate disparate technologies into a cohesive system that enhances efficiency rather than complicating workflows that employees are used to.

“A significant portion of respondents know that they have to change. Either they are getting systems in order to do so or are a work-in-progress towards being ready for the technology deployment,” said Bernard. “They are also seeing a lot of consolidation among technology providers as well, which means multiple systems could soon be working together. So I believe people are making do with what they have and getting ready for [consolidation].”

As companies work to modernize, their technology investment priorities reveal a clear roadmap for the industry’s future of integrated systems. According to Trigent’s survey, 37% of respondents cited APIs and ecosystem connectivity as their primary focus. This reflects the growing recognition that seamless data exchange between carriers, shippers and brokers is essential for technology investments to pay off.

RELATED: Q&A: Can the industry loosen up its data bottlenecks?

Bernard explained that In an industry where real-time visibility and agile decision-making can be the difference between success and failure, API integrations are no longer optional, they are imperative.

Another takeaway from the survey is the demand for customized transportation management systems. Carriers, in particular, are keen on developing self-service systems that can streamline operations without extra human intervention. These technologies can even help mitigate talent shortages by reducing the need for manual processing.

“When we talk about talent shortages, it’s not just technology-skilled shortages, we are talking about warehouse pickers and handlers and drivers. Companies are asking themselves, where does technology support my workers, knowing I’m not going to be having that many skilled workers to choose from for my warehouse, etc,” said Bernard.

RELATED: Agility Robotics’ humanoid robot reportedly raising $400M

With technology supporting businesses in new offerings, Bernard described seeing many 3PLs moving more toward an integrated 4PL approach.

“There are so many tech offerings that can easily integrate into your management systems that can help shippers with other things than finding capacity, including inventory management and last-mile logistics. Because 3PLs traditional models are seeing shrinking margins, these integrations help with other avenues of revenue building,” he explained.

Bernard followed up with that, saying that AI will help with these other revenue generators as well. He told FreightWaves that AI is no longer a question of “if” but rather “when” and “how.” Companies are increasingly exploring AI-driven solutions tailored to their specific operational challenges. However, Bernard expressed that the key to successful AI adoption lies not in simply automating existing workflows but in redesigning business processes to fully leverage technological capabilities.

Trigent advocates a three-pronged strategy for technological advancement. The first component involves embedding AI across multiple facets of logistics operations to enhance decision-making and predictive capabilities. The second focuses on modernizing existing platforms, as businesses must upgrade their legacy systems to support modern technologies and integrations with new digital tools. The third prong calls for reimagining business processes rather than applying technology as a band-aid solution. Companies should fundamentally rethink their workflows and how technology supports them.

“We can learn from Deepseek. They did not look to optimize what was already existing in AI technology. They shoot the fundamentals of how it works. Businesses should do this too. Many say, I don’t have a bucket of money, but I want to get these things automated. Reassess the business and reimagine your entire workflows. That is very critical to you getting the automation piece right,” he said.

Articles by Grace Sharkey

SFOO Summit: Carriers need AI agents to keep up with broker tech

Uber Freight’s Powerloop begins offering dedicated tours to carriers

Autonomous dispatcher Bubba AI launches for independent truckers, small carriers

Forward Air flags 10% to 15% revenue impact from new tariffs

A pair of Forward Air trailers at an airport warehouse

Forward Air cautioned investors on Wednesday that 10% to 15% of its 2024 revenue would have been impacted by recently announced tariffs.

The Greeneville, Tennessee-based transportation and logistics company flagged the portion of its $2.5 billion top line as potentially being affected by tariffs announced on April 2.

“After reviewing the preliminary IEEPA [International Emergency Economic Powers Act] details, the Company currently estimates that between 10 percent and 15 percent of its revenue in 2024 would have been from shipments directly transported under its control from the countries potentially impacted by the evolving landscape around the tariff increases announced on April 2, 2025,” a news release said.

It said it’s “unable to estimate the potential tariff impact to shipments handled prior to being transported under our control, including in our Intermodal segment.”

Forward’s (NASDAQ: FWRD) intermodal unit reported $233 million in revenue last year.

The news release also said first-quarter adjusted earnings before interest, taxes, depreciation and amortization is expected to be in a range of $54 million to $59 million when the company reports results on May 7. Forward generated $308 million in adjusted EBITDA in 2024.

Liquidity is expected to improve by $10 million to $392 million sequentially in the first quarter. The company ended the year at a 5.5 times net leverage ratio. It isn’t required to meet the 5.5 times threshold until the fourth quarter of 2026 per its new debt covenant.

Forward’s revenue mix has changed after the January 2024 acquisition of freight forwarder Omni Logistics. Some investors tried to block the transaction given the high debt burden that would need to be assumed. Even Forward attempted to break the deal after pressure from shareholders mounted.

The company is currently conducting a strategic review assessing all options, which include a potential sale.

Shares of FWRD closed Tuesday at $10.50, down 67% on the year and 91% lower than when the Omni deal was announced in August 2023. The stock was off 3.2% in early trading on Wednesday compared to the S&P 500, which was up 0.8%.

More FreightWaves articles by Todd Maiden:

EU slaps retaliatory tariffs on $22B worth of US products

The European Union on Wednesday approved tariffs of up to 25% on more than $22 billion worth of U.S. goods, including orange juice, soybeans, motorcycles, beauty products and more.

The European Commission, the EU’s primary executive arm, said duties on U.S. imports would start being collected on April 15.

The levies are retaliation for the Trump administration’s duties on imports of steel and aluminium from EU nations.

“The EU considers U.S. tariffs unjustified and damaging, causing economic harm to both sides, as well as the global economy,” European Commission trade spokesperson Olof Gill said in a news release. “These countermeasures can be suspended at any time, should the U.S. agree to a fair and balanced negotiated outcome.”

President Donald Trump’s wide-ranging “reciprocal” tariff policy went into effect at 12:01 a.m. on Wednesday, including various levies on imports from about 90 U.S. trading partners.

Other U.S. products that will be hit with EU tariffs on April 15 include boats and yachts, coffee, copper, steel and iron, and live poultry.

Related: Trump’s sweeping tariffs go into effect, including 104% on China imports

Ocean container bookings plummet as Trump’s tariffs take effect

In a clear sign that the Trump administration’s tariffs are beginning to impact global trade, ocean container bookings from China to the United States have dropped sharply in recent weeks. Data from SONAR’s Container Atlas reveals that daily bookings on this crucial trade route have plummeted 25% compared to the same period last year, signaling a potential seismic shift in trans-Pacific trade patterns.

Container Atlas, which captures data on container movements at the point of booking, often more than a week before vessels depart, shows that the impact of the tariffs is already being felt in the supply chain. This leading indicator suggests that the full effects of the trade dispute have yet to materialize in current shipping volumes, as the average lead time between booking and sailing stands at nine days.

(This chart displays global ocean container bookings from all origins to all destinations. Chart: SONAR. To learn more about SONAR, click here.)

The downturn is not limited to the China-U.S. route. Global ocean container bookings have also seen a significant decline, falling 18.4% between March 30 and April 8. Current booking levels are now running 13% below those seen in 2024, a reversal from that year’s growth.

It’s reasonable to attribute most of this sudden drop to the Trump administration’s aggressive tariff policy, including the recently imposed 104% tariff on Chinese imports. The opportunity for importers to “pull forward” inventory – a strategy employed to avoid tariffs by importing goods earlier than usual – has now passed, leaving many businesses grappling with the new economic reality.

In a typical year, eastbound trans-Pacific container volumes experience a surge prior to the Lunar New Year, followed by a sharp drop-off and a gradual recovery leading up to peak season in August and September. However, this year’s pattern has already been disrupted by the escalating trade tensions between the United States and China.

According to Container Atlas data, daily ocean container bookings from China to the U.S. reached their zenith on March 19 but have since fallen by a staggering 31%. This dramatic decline underscores the immediate and tangible impact of the tariffs on trade flows.

(The Ocean Booking Volume Index dates volumes to the day when the bookings were made. Chart: SONAR. To learn more about SONAR, click here.)

Some importers have temporarily halted inbound shipments as they reassess their strategies in light of the new tariff regime. These pauses may be transient as companies work to navigate the changing economic landscape. However, for businesses whose models rely heavily on specific goods targeted by the Trump administration’s tariffs, the effects could be more enduring.

The current data presents a complex picture. While it clearly demonstrates that the tariffs have had an immediate and significant impact on ocean container bookings, particularly from China to the United States, it’s too early to determine the long-term implications. Industry observers are watching to learn how much of the current drop can be attributed to temporary, strategic pauses in imports as supply chain teams regroup, versus more permanent economic shifts.

This sudden downturn in container bookings comes after a period of heightened activity in 2024, during which many importers accelerated shipments in anticipation of potential tariff increases. This pull-forward effect contributed to the robust container volumes seen last year but has now given way to a sharp contraction as the new tariffs take effect.

The ripple effects of this decline in container bookings are likely to be felt throughout the global supply chain. Shipping lines may need to adjust their capacity and routing strategies, while ports and logistics providers could face reduced activity. Moreover, the impact on consumer prices and product availability in the United States remains to be seen, as importers grapple with higher costs and potential supply disruptions.

Trump’s sweeping tariffs go into effect, including 104% on China imports

President Donald Trump’s wide ranging “reciprocal” tariff policy went into effect at 12:01 a.m. on Wednesday, including 104% duties on goods from China, as well as various levies on imports from about 90 other U.S. trading partners.

Officials in China on Wednesday announced retaliatory duties on U.S. imports to 84%, up from 34%, starting on Thursday.

The escalation of tariffs further deteriorates U.S.-China trade relations, after China vowed on Tuesday to “fight to the end” in the renewed trade war.

“The U.S. threat to escalate tariffs on China is a mistake on top of a mistake and once again exposes the blackmailing nature of the U.S. China will never accept this. If the U.S. insists on its own way, China will fight to the end,” China’s Commerce Ministry said on Tuesday, according to the Associated Press.

China was the third-ranked U.S. trading partner in 2024 at $582 billion in cross-border commerce.

Trump unveiled a broad “reciprocal” tariff plan for all U.S. trade partners April 2, including a baseline 10% tariff on trade partners, as well as 25% tariffs on certain imported vehicles and auto parts arriving into the U.S.

Several nations, including Vietnam, Taiwan and Japan, have seemed willing to negotiate on tariffs. The European Union is also pushing for negotiations to avert an all-out trade war.

Trucking and logistics bankruptcies reported across US

Two trucking companies and a 3PL recently filed for Chapter 11 bankruptcy protection in separate cases.

C & C Freight Network, Best Choice Trucking and Best Logistics Inc. cited everything from mounting debt to payroll taxes as reasons for the bankruptcy petitions.

Best Choice Trucking

Dedham, Massachusetts-based Best Choice Trucking LLC, which has nine drivers and nine power units, filed its petition Monday in the U.S. Bankruptcy Court for the District of Massachusetts.

The petition lists Ulysses Fabricio as president of the company, which hauls full-truckload, last-mile and hazmat freight.

Best Choice Trucking listed its assets and liabilities as between $1 million and $10 million. The company, which seeks to reorganize, has up to 49 creditors and maintains that funds will be available for unsecured creditors once it pays administrative fees.

Some of the company’s largest listed creditors include Digital Federal Credit Union for $1.6 million; Trans Lease Inc. for a 2023 Peterbilt 389 tractor ($386,585); and the U.S. Small Business Administration ($371,017).

Best Choice Trucking’s trucks had been inspected eight times, with no vehicles placed out of service in a 24-month period, according to the Federal Motor Carrier Safety Administration’s SAFER website.

The carrier’s drivers had been inspected 17 times over the same 24-month period, with three drivers being placed out of service, resulting in a 17.6% out-of-service rate. The national average is around 6.7%, according to FMCSA.

C & C Freight Network

C & C Freight Network, a Braselton, Georgia-based trucking company with seven drivers and trucks, filed for Chapter 11 bankruptcy protection on Monday in the U.S. Bankruptcy Court for the Northern District of Georgia.

In its petition, C & C Freight Network listed its assets and liabilities as between $1 million and $10 million. The company, which seeks to reorganize, states that it has up to 49 creditors but said no funds will be available for unsecured creditors once it pays administrative fees.

C & C Freight Network’s largest creditor is the Small Business Administration for a COVID-19 economic injury disaster loan for $161,425.

Other creditors include Headway Capital LLC for equipment ($87,945); Fora Financial Advance LLC for equipment and inventory ($72,939); MCA Servicing Co. ($63,842); Mint Funding Inc. ($60,364); and BMO Harris Bank for a 2020 Volvo tractor ($56,545).

C & C Freight Network’s trucks had been inspected eight times, and three had been placed out of service in a 24-month period, resulting in a 37.5% out-of-service rate. This is higher than the industry’s national average of around 22.3%, according to the FMCSA.

The carrier’s drivers had been inspected 23 times over the same 24-month period with two drivers being placed out of service, resulting in an 8.7% out-of-service rate. That compares with the national average of around 6.7%.

C & C Freight Network’s common carrier authority was granted in April 2016.

The bankruptcy petition lists Charles Alderman as manager of C & C Freight Network, which hauls general freight.

Best Logistics Inc.

Memphis, Tennessee-based Best Logistics Inc. filed for bankruptcy protection in the Western District of Tennessee on Monday.

The 3PL listed assets of up to $50,000 and liabilities of between $50,000 to $100,000. The company listed 49 creditors and maintains that funds will be available for unsecured creditors once it pays administrative fees.

Creditors include the IRS for payroll taxes, along with the city of Memphis and Shelby County, Tennessee.

The petition lists Phyllis Brown as president of Best Logistics.

House bill targets staged truck crashes

Staged crashes jack up insurance for carriers, truck drivers. (Photo: Jim Allen/FreightWaves)

WASHINGTON – Fraudsters who stage truck accidents with the goal of suing trucking companies for millions of dollars will face stiff penalties if Congress approves new legislation.

The Staged Accident Fraud Prevention Act, introduced in the U.S. House on Tuesday by Rep. Mike Collins, R-Ga., and Brandon Gill, R-Texas, would make intentionally staging a crash with a motor vehicle a federal crime.

According to the legislation, a person operating a motor vehicle who intentionally causes a collision with a commercial motor vehicle – or arranges for another person to cause a collision – will be fined, imprisoned for up to 20 years or both. If the collision results in serious injury or death, the prison sentence changes to at least 20 years.

“Increasingly, con artists in passenger vehicles are intentionally colliding with commercial motor vehicles to file frivolous lawsuits, seeking damages that often exceed seven figures,” the lawmakers stated in a press release announcing the bill.

“These accidents endanger highway travelers, drive up the costs of insurance, and put small owner-operators out of business. The [legislation] establishes clear, enforceable criminal penalties for those who stage these collisions, as well as the attorneys, physicians, and other co-conspirators who knowingly participate in this fraud.”

One of the biggest fake-crash cases involving a semitruck, which prosecutors have dubbed Operation Sideswipe, has been ongoing in Louisiana since 2019. It involved scores of staged crashes and resulted in 63 indictments.

“When con artists seeking a big payday intentionally collide with commercial motor vehicles, their reckless disregard for safety puts innocent truck drivers and the motoring public at risk,” said Henry Hanscom, American Trucking Associations senior vice president of legislative affairs, in a statement.

“These unscrupulous individuals perpetuate their selfish actions by filing frivolous lawsuits against honest trucking companies, raising costs for consumer goods and contributing to soaring insurance premiums.”

The Owner-Operator Independent Drivers Association also sees the need for legislation targeting staged crashes.

“To add insult to injury, criminals abuse the legal system for profit through false accusations and lawsuits, which contribute to skyrocketing insurance premiums for small trucking businesses,” said Lewie Pugh, executive vice president of OOIDA, in a statement.

The legislation, Pugh said, will “protect law-abiding truckers from sophisticated criminal fraud schemes that exploit the hardworking men and women behind the wheel.”

Click for more FreightWaves articles by John Gallagher.

LTL rates projected to keep rising y/y in Q2, TL rates to stay ‘at the bottom’

An overview of trailers at an LTL terminal

Amid soft demand and trade uncertainty, less-than-truckload pricing remained resilient during the first quarter while truckload rates stayed depressed. The trends are expected to continue through the second quarter, a Tuesday report from 3PL AFS Logistics and financial services firm TD Cowen showed.

The LTL rate-per-pound component of the TD Cowen/AFS Freight Index stood 63.8% higher in the 2025 first quarter than its January 2018 baseline. That was a 280-basis-point increase year over year and 80 bps higher than the fourth-quarter reading. The rate index is expected to dip 40 bps to 63.4% during the second quarter but come in 110 bps higher y/y, which would be a sixth straight y/y increase.

“For now, LTL carriers are effectively navigating a low-demand environment with a focus on profitable lanes, contractual relationships and reliable freight, rather than chasing volume with pricing concessions,” Aaron LaGanke, vice president of freight services at AFS, stated in the report.

First-quarter updates from LTL carriers showed yields were up slightly y/y inclusive of fuel surcharges and more notably when excluding fuel’s impact. However, volumes continued to lag as tonnage was down y/y by mid-single-digit percentages for most carriers in the first two months of the year.

SONAR: Longhaul LTL Monthly Rate per Ton Mile, Class 50-65 Index. Less-than-truckload monthly indices are based on the median rate per ton mile for four National Motor Freight Classification groupings and five different mileage bands. To learn more about SONAR, click here.

Cost per LTL shipment remained elevated in the first quarter, up 1.5% sequentially and 0.5% y/y, according to the report.

Price bumps from carriers along with annual general rate increases implemented over the past several months are now fully in force for 2025, which pushed the cost index higher. Also, fuel prices rose 3% sequentially in the first quarter. The report said the average carrier fuel surcharge was up 1.8% in the period with the net fuel surcharge per shipment increasing 4%.

The cost-per-shipment dataset was also influenced by a 2.4% sequential decline in length of haul and a 0.2% dip in weight per shipment (down 9% y/y).

TL rates to see ninth quarter ‘at the bottom’

The TL rate-per-mile index was just 5.9% higher than the January 2018 baseline during the first quarter. That reading was up 70 bps from the fourth quarter and 100 bps y/y. (The index was more than 25% higher than the baseline as late as the 2022 first quarter – the tail end of the last upcycle.)

The slight move up was tied to shippers pulling forward inventory ahead of tariffs as well as the impacts from inclement weather and natural disasters, all of which resulted in some capacity tightening during the period, the report said.

SONAR: National Truckload Index (linehaul only – NTIL) *for 2025 (blue shaded area), 2024 (green line) and 2023 (pink line)*. The NTIL is based on an average of booked spot dry van loads from 250,000 lanes. The NTIL is a seven-day moving average of linehaul spot rates excluding fuel. Spot rates remain slightly higher on a y/y comparison. To learn more about SONAR, click here.

Linehaul cost per shipment was down 1.5% sequentially in the first quarter, but miles per shipment were off 2%. A small increase in mix to favor short-haul moves (sub-500 miles) left the cost per shipment index just 5% higher than before the pandemic.

The forecast calls for the TL rate index to be 40 bps lower sequentially in the second quarter but 50 bps higher y/y. That would mark nine straight quarters “at the bottom,” the report said.

The update also showed that ground parcel rates were 31.3% higher than the 2018 baseline in the first quarter (500 bps higher sequentially and 250 bps higher y/y). The dataset is expected to be 29.5% above the baseline in the second quarter.

Express parcel rates remain depressed, just 3.4% higher in the first quarter than they were at the start of 2018. The forecast is for the index to be 3.1% higher than 2018 levels in the second quarter.

“Tariffs have become the topic du jour in boardrooms and beyond, and combining those policy changes with a cloudy macroeconomic picture is a recipe for the uncertainty and caution that characterize current market sentiment,” said AFS Logistics CEO Andy Dyer. “These conditions do not indicate a shift away from the malaise of soft demand that has shaped domestic transportation markets for quite some time.”

AFS Logistics is a non-asset-based 3PL providing audit and cost management services, managed transportation, and freight brokerage. It has visibility into more than $39 billion in annual freight spend.

More FreightWaves articles by Todd Maiden:

Benchmark diesel price up as pump number lags big fall in futures markets

In its new publication time Tuesday morning, the benchmark diesel price used for most fuel surcharges rose on the back of increases in diesel futures that now seem a distant memory.

The Department of Energy/Energy Information Administration price rose 4.7 cents a gallon, to $3.639. It’s the third consecutive weekly increase, and it has added 9 cents to the benchmark during that time.

An increase in diesel prices in the midst of what has been a significant collapse in oil prices may look odd. It occurred despite the collapse in futures prices for crude, diesel and gasoline in futures markets in recent days on the backs of a decline in virtually all asset classes: stock, crypto and the dollar. (The fall in the dollar and the concurrent decrease in oil prices is unusual, because oil and the greenback tend to move in opposite directions.)

But the retail price lag is reflecting an increase in the price of ultra low sulfur diesel (ULSD) on the CME commodity exchange that took place several weeks ago. From a settlement of $2.1622 a gallon on March 13, ULSD rose to a high settlement of $2.314 on March 31.

But that was followed by a slide that resulted in Monday’s settlement of $2.0699 a gallon. That decline marked an outright decline of 24.41 cents per gallon and a percentage decline of 10.5% over just five trading days.

Oil markets midday Tuesday were rebounding slightly, with ULSD up a little more than 1% at about 12:15 p.m.

As tends to be the case when oil markets are extremely volatile as a result of external factors, crude moves up or down by a greater percentage than gasoline or diesel. That’s apparent in the comparison between Brent and ULSD, which moved to a spread of 54.1 cents a gallon of ULSD over Brent on Monday after being 50.8 cents a gallon on March 28.

The latest publication of the DOE/EIA price was the first time it had been released at its new regular time of Tuesday around 10 a.m., instead of late Monday afternoon. However, the price remains effective for the prior day so that the new price’s effective date is listed as April 7.

There has been one development in oil market fundamentals that has also been a factor in the price decline: the decision by the OPEC+ group to go ahead with production increases scheduled for the start of this month, despite the fall in prices. The gradual rollback in production cuts in place since 2023 was slated to begin this month. As April came, there was no pullback in that plan, as there has been during other times when the reduction in output was supposed to take place.

In a commentary for Bloomberg, longtime commodities expert Javier Blas said the increase in output, backed by Saudi Arabia, may have longer-term strategic goals.

“Whether the Saudis wanted to teach a lesson to OPEC+ cheaters like Kazakhstan, Iraq and the United Arab Emirates, or they had Trump in mind is unclear,” Blas wrote, noting that Trump also desires lower prices. “I believe both factors played a role.”

More articles by John Kingston

Clash on legal status of California transportation waivers highlighted at TCA

ATBS says independent drivers earned a little more in ’24 but drove more as well

Truck driver triumphs at Supreme Court in case involving marijuana testing