How To Decode TL Rates Rising Despite Freight Volume Trends

TL rates are climbing even as Freight Volume softens — counterintuitive, but increasingly common. This article breaks down why prices can rise when loads don’t, unpacking capacity exits, service risk, and contract-spot dynamics. You’ll learn how to read the key indicators behind the divergence and what they signal for the next quarter. Expect practical guidance to forecast costs, negotiate smarter, and adjust your routing guide with confidence.

Freight Volumes Decline While Shipping Costs Continue to Rise

Recent data from Cass Information Systems reveals a complex picture for the trucking and logistics industry, where freight volumes are declining while transportation costs continue to increase. The company’s latest freight indexes highlight how weather disruptions, inventory strategies, and broader market forces are shaping freight demand across the United States.

Freight Shipments Drop to Levels Not Seen Since the Financial Crisis

According to Cass’ multimodal shipments index, freight volumes declined 7.1% year over year and 14.7% compared to two years ago, marking the lowest level since the late stages of the Global Financial Crisis in 2009. On a seasonally adjusted basis, shipments also fell 2% compared to December, reflecting continued softness in freight demand at the start of the year.

Several factors contributed to the downturn in freight activity. Severe winter weather disrupted transportation networks across multiple regions, with some less-than-truckload carriers reporting that weather conditions alone reduced shipments by roughly three percentage points. At the same time, retailers entered the year with leaner inventory levels, limiting the need for immediate restocking.

Earlier reports from the Logistics Managers’ Index also indicated that January restocking activity occurred at one of the slowest paces on record for that month. Businesses remain cautious about holding large inventories because of rising storage and carrying costs, which continue to influence supply chain decisions.

Freight Spending Climbs Despite Lower Shipping Activity

While shipment volumes declined, overall freight spending showed modest growth. Cass’ expenditures index, which measures total freight spend including fuel costs, increased 0.6% year over year and 0.4% month over month on a seasonally adjusted basis. Without seasonal adjustments, expenditures were down 3.6% sequentially, but the longer-term two-year decline of 3.6% was the narrowest since July 2023.

The divergence between falling shipment volumes and rising spending suggests that freight rates are climbing, even as demand softens. Analysts estimate that shipping rates may have increased approximately 8% year over year in January, although the exact figure may vary depending on shipment mix and market conditions.

Cass no longer publishes an inferred rate index, but the combination of volume declines and spending growth strongly indicates upward pressure on pricing across segments of the freight market.

Truckload Rates Continue Gradual Upward Momentum

Additional insight comes from the truckload linehaul index, which excludes fuel surcharges and accessorial fees. This index rose 1.7% from December and 3.2% year over year, continuing a steady recovery in truckload pricing.

January marked the 13th consecutive year-over-year increase in the index after a prolonged 24-month stretch of declining rates. On a two-year stacked basis, the index is now up about 4%, suggesting that pricing conditions are slowly stabilizing after the industry’s recent freight recession.

During fourth-quarter earnings calls, several truckload carriers projected contract rate increases in the low to mid-single-digit range for the coming year. Lower increases are expected for index-based dedicated contracts, while higher adjustments may apply to one-way contractual freight.

Regulatory Pressures Could Push Rates Higher

Some analysts believe the initial rate forecasts from carriers may be overly conservative. A range of regulatory developments could tighten driver supply and push freight rates higher than expected.

These include stricter enforcement of English proficiency standards, increased scrutiny on non-domiciled commercial driver’s licenses, and expanded oversight of electronic logging devices and driver training schools by regulators such as the Federal Motor Carrier Safety Administration.

Industry experts note that the trucking sector has endured several years of rising operational costs paired with stagnant freight rates. As a result, stronger rate growth may be necessary for many carriers to restore profitability and stabilize their margins.

Data Source Behind the Freight Indexes

The widely followed Cass freight indexes are built using real-world freight payment data processed by Cass. The company manages approximately $37 billion in freight payables each year for clients across multiple industries, providing a comprehensive view of shipping activity and transportation costs.

By analyzing freight invoices across trucking, rail, and other modes, Cass offers one of the most reliable indicators of trends shaping the logistics and transportation economy.

Conclusion

The latest freight data highlights a challenging but evolving landscape for the trucking industry. While freight volumes remain under pressure due to weather disruptions and cautious inventory strategies, transportation costs are gradually climbing as the market adjusts to supply constraints and regulatory changes.

If these trends continue, the industry may see a gradual tightening of capacity, which could help sustain higher freight rates even as shipment volumes recover later in the year. For carriers, shippers, and logistics providers, staying informed about these shifting dynamics will be critical to navigating the months ahead.

Stay Compliant and Informed in a Changing Freight Market

As freight volumes fluctuate and transportation costs continue to rise, staying informed about industry trends is more important than ever for carriers, owner-operators, and logistics professionals. Market shifts, regulatory developments, and operational challenges can all impact how trucking businesses operate and remain competitive.

If you want to stay updated with the latest trends, actionable insights, and important developments shaping the trucking, freight, and logistics industry, be sure to stay connected with us for more industry updates and expert perspectives.

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