The global logistics market is experiencing a significant cooling phase, with a pronounced imbalance between supply and demand, according to a recent analysis by Omni Logistics. Excess capacity across multiple transportation modes is contributing to falling rates and a softening market, despite steady consumer demand.
The ocean freight market has been a key indicator of this trend, with container rates plummeting for eleven consecutive weeks.
Rates are now more than 50% lower than the previous year, even as new vessel orders continue to rise. While the air cargo sector is more stable, it is also seeing a slowdown in activity, signaling a broader market shift away from the pandemic-era freight boom.
On the ground, the U.S. trucking industry remains soft. Spot rates have held flat, and less-than-truckload (LTL) volumes are contracting. In contrast, railroads are gaining momentum, driven by a rise in intermodal shipments. Concurrently, the warehousing landscape is evolving, with demand shifting toward specialized facilities like free trade zones and custom-built sites, while interest in older storage properties declines.
The report also highlights geopolitical and economic factors influencing logistics networks. The removal of the de minimis exemption and new tariffs on imports from China, India, and other nations are straining parcel networks and forcing companies to re-evaluate their sourcing strategies.
Globally, China is strengthening trade ties with South America and Africa, while U.S. farmers face challenges in placing their abundant harvests. Positive developments include the European Union’s efforts to increase access for American goods and Canada’s reduction of certain tariffs.
As the holiday season approaches, the market remains fragile. Over 75% of retail buyers report inventory concerns, setting the stage for a potentially volatile season.
The underlying economy shows inflation at 0.7% overall, with core inflation at 3.1%, which may contribute to cautious consumer behavior. Despite the challenges, steady consumer demand provides a glimmer of stability for the coming months.
Omni Logistics is a leading global logistics provider, specializing in end-to-end supply chain solutions.
