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Yahoo
4 days ago
- Business
- Yahoo
Tariffs, economic uncertainties keep freight markets flat, analysts say
This story was originally published on Trucking Dive. To receive daily news and insights, subscribe to our free daily Trucking Dive newsletter. The Trump administration's ongoing tariff actions, combined with current economic conditions, continue to cloud freight rates in the trucking industry. Truckload freight rates remained under pressure from excess capacity in the market, while less-than-truckload is seeing a year-over-year positive change as carriers manage profitability, according to the TD Cowen/AFS Freight Index released July 15. "Despite plenty of international travel by world leaders, trade policy remains an unsettled picture and businesses are opting for a wait-and-see approach and delaying spending decisions,' Andy Dyer, CEO of AFS, said in a press release. "With no catalyst to ignite demand, some carriers are buckling under the pressure of unrelenting low volumes while others are deploying all available mechanisms to capture revenue." Excess capacity in the truckload market The index projects a tenth straight quarter with truckload rates at or near the bottom. Q3 rates are expected to be at 5.6% above the 2018 baseline, reflecting a 0.4% quarter-over-quarter decline. Taking a closer look, the truckload market is stuck in a rut, again, and excess capacity is a key driver. Excess capacity can be traced back to the COVID-19 pandemic, when a number of carriers entered the market due to increased demand, Aaron LaGanke, VP of freight services at AFS, told Trucking Dive in an email. As time passed, inflation skyrocketed, economic uncertainty grew and demand increased, leading to too many carriers to meet soft demand, LaGanke said. 'And while a number of carriers have left the marketplace, these have mostly been very small carriers that haven't cut too deeply into the excess capacity,' he added. Excess capacity and low rates will continue unless there is a larger industry contraction or a growth in demand, LaGanke said. One way the truckload market could experience some ease is through the regulatory guidance for stricter labor and language standards for truck drivers. The policy from the Trump administration 'could constrict the supply of truck drivers, which could in turn limit truckload capacity and influence supply and demand pricing dynamics in the market,' he said. LTL carriers focus on profitability strategies While the LTL market is also being impacted by the same global trade and economic conditions, carriers are holding firm on pricing, in turn creating only slight declines in costs per shipment. Weight per shipment declined 5.1% YoY, but cost per shipment fell by 2.9%, per the release. In a low-demand environment, LTL carriers are focusing on profitable lanes, contractual relationships and reliable freight, rather than chasing volume with discounted pricing, LaGanke said. These strategies are showing positive results as the TD Cowen/AFS LTL Freight Index report is expected to reach 65.9% from its 2018 baseline, marking a 1% year-over-year increase. The increase will also mark the seventh consecutive quarter with positive YoY changes, per the report. "The continued resilience of the rate per pound index shows the effect of carrier pricing discipline, and the upcoming NMFC transition to a density framework should equip carriers with another method to tightly manage freight classification and pricing,' LaGanke said in the release. The National Motor Freight Traffic Association classification overhaul kicked off on July 19, and while it adds more pricing discipline and transparency, it's still too early to see the actual impact on the LTL market, Mich Fabriga, VP of LTL Pricing at AFS, said in an email. Recommended Reading Tariff concerns weigh on freight recovery: report
Yahoo
4 days ago
- Business
- Yahoo
What plastic, paper and metal commodity experts are watching with tariffs
This story was originally published on Waste Dive. To receive daily news and insights, subscribe to our free daily Waste Dive newsletter. Editor's note: This story is part of a series highlighting takeaways from a July 23 virtual event hosted by Packaging Dive, Supply Chain Dive, Manufacturing Dive and Trucking Dive. Register here to watch the replay on demand. It's normal for commodity markets to ebb and flow due to a variety of domestic and global factors, but recent tariff impacts and changes in the U.S. economy in 2025 have thrown a new wrench in markets for virgin and recycled aluminum, plastic and fiber commodities. Experts in plastics, paper and metals offered an overview of these factors during the 'Supply Chain Outlook: Trends and Risks to Watch in 2025' event on Wednesday. The Trump administration's tariffs have resulted in market uncertainty, and that's playing out in different ways depending on the commodity, speakers said. These were some key takeaways from the event: Varied trade exposure, but also opportunities for US plastic manufacturing In the plastics industry, tariff exposure varies by sector. For example, plastic resins face less uncertainty compared with the machinery and molds sectors, said Perc Pineda, chief economist at the Plastics Industry Association. 'By and large, the plastics industry's exposure to trade is only about 20%,' he said, noting that there's currently 'a lot' of U.S. plastics production capacity and low utilization. 'If there is a need for import substitution because tariff rates are so high it's cost prohibitive, I am confident that domestic manufacturing could actually step in,' he said. The United States is a net importer of recycled plastics materials, he said. At the same time, domestic virgin resin production has increased by 5% year over year, which he sees as a sign that such production could help backfill demand if recycled commodities become harder to source due to tariffs. In June, virgin resin prices rose by 0.3%, which he sees as a sign that higher tariffs haven't automatically translated to higher inflation. However, the U.S. imports about 70% of the machinery it needs for plastic production, plus around half of needed molds, leading the industry to call for certain tariff exemptions in these sectors, he said. The industry is monitoring the situation, but likely won't see the true effects of such tariffs for several months. 'I know things are evolving, but I am hopeful, because I don't think the economy can continue with a scenario like this, when there's so much uncertainty. It has long-term effects, and the knock-on effects on the economy are going to be broad and wide.' Section 232 tariffs continue to impact steel and aluminum can manufacturing Section 232 aluminum and steel tariffs, which have been in place since 2018, went from 25% to 50% earlier this year. That has increased costs for aluminum and steel cans used for food, beverages and other items. The Can Manufacturers Institute and other groups are calling for specific tariff exemptions on aluminum imported from Canada, as well as on tin plate typically used to make steel cans, said CMI President Scott Breen. The industry prides itself on its recycled content use, Breen said. The average aluminum beverage can is made of about 71% recycled content, 'but that does mean that 29% is virgin or new aluminum, and most of that virgin aluminum is imported,' mainly from Canada, he said. For steel cans, nearly 80% of tin plate is imported, and 'we would love to purchase more domestic tin plate, but it's just not produced at the levels we need,' he said. Since 2018, nine of the 12 tin plate lines available in the U.S. have shut down, he said. Breen said continued tariffs will likely lead to increased food prices, citing a study from the Consumer Brands Association estimating a 9% to to 15% increase in the cost of canned goods. Broader economic trends, not tariffs, driving US fiber trade for now Meanwhile, broader changes in the global economy are making more of an impact on the fiber industry than tariffs specifically are, said Terry Webber, vice president of industry affairs for the American Forest & Paper Association. Paper is 'a commodity that tracks pretty closely to general economic performances. There's more economic activity, there's more paper and paper-based packaging consumed,' he said. The U.S. exports about 6 million tons of packaging papers globally. However, about 70% of the nation's external fiber trade is with Canada and Mexico, 'so as long as that trading relationship continues, that's going to cover the lion's share of the business we do,' he said. U.S. exports of recovered fiber to global markets have been declining in recent years, and the U.S. has focused on domestic investments meant to expand manufacturing that uses recycled fiber, namely OCC and mixed paper, he said. He estimated that AF&PA companies have announced about $7 billion in recent investments, 'so we're seeing a long-term positive trend in U.S. mill consumption that's helping to offset some of those changes that we're seeing in global trade flows.' At the same time, the U.S. has seen multiple notable mill closures in the first half of 2025. Webber attributed that activity to the industry adjusting its output to market demands. 'As capacity is coming offline, we're making investments in new capacity' while making the overall supply chains more efficient, he said. Webber noted AF&PA is tracking possible tariff impacts on equipment, which is typically imported from regions like Europe. 'It would be unfortunate if the spending and investment that our companies are conducting becomes subject to tariffs," he said. Recommended Reading ISRI says its rebrand to ReMA reflects the recycling industry's modern values Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
21-07-2025
- Automotive
- Yahoo
A closer look at ArcBest's Class EV Pilot
This story was originally published on Trucking Dive. To receive daily news and insights, subscribe to our free daily Trucking Dive newsletter. When ArcBest tested a Class 8 electric semi-truck between service centers in Reno, Nevada, and Sacramento, California, the EV met performance expectations but one challenge the LTL carrier highlighted was the need for more robust charging infrastructure. During its three-week pilot, ArcBest determined there was a need for more charging spots to adequately match those performance needs. For its test, the carrier selected a lane with heavy-duty chargers at both ends to maintain its dispatch schedule without disruption. But the setup is the exception and not the norm, a spokesperson for the company told Trucking Dive in an email. 'While charging worked well in this controlled scenario, the current availability of high-capacity chargers is limited. Expanding infrastructure will be essential to support broader electrification of over-the-road operations,' the spokesperson said. While charging infrastructure remains a challenge, the number of EV charging stations across California has grown. WattEV recently broke ground for a new charging depot at the Port of Oakland and a Northwest Seaport Alliance grant will assist Zeem Solutions to build an EV charging facility in SeaTac, Washington. ArcBest's Class 8 EV pilot operated with standard freight loads and pulled full-length trailers, hauling the typical mix of cargo the carrier handles daily. 'The electric Semi logged 4,494 miles, averaging 321 miles per day with an overall energy efficiency of 1.55 kWh per mile,' according to a July 9 press release. The carrier is focused on applying what it learned during the pilot to identify additional use cases and transit lanes where electric semis can deliver similar results, the spokesperson said. The pilot also got positive driver feedback — with operators noting the vehicle's comfort, safety and ease of use. 'We're not looking for a truck that performs well 'for an EV,'' Matt Godfrey, ABF Freight president, said in the release. 'It must meet or exceed the performance and total cost of ownership targets of our most efficient diesel units. This pilot gives us great insight into the potential of electric semis in our operations,' he said. While this was the company's first pilot of a Class 8 over-the-road electric semi, it's not its first involvement with EVs. ArcBest operates two class 6 EV straight trucks, nine EV yard tractors and two electric forklifts, per the release. 'Our customers increasingly value partners who are forward-thinking and environmentally responsible,' the spokesperson said. 'Continuing to explore and adopt electric vehicles is one of the ways we are delivering a reliable, premium service while helping our customers meet their own sustainability goals. Recommended Reading ABF Freight expands EV yard truck fleet Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
16-07-2025
- Business
- Yahoo
Del Monte Foods bankruptcy threatens $1.35M loss for carrier
This story was originally published on Trucking Dive. To receive daily news and insights, subscribe to our free daily Trucking Dive newsletter. Saddle Creek Logistics Services, a warehousing and transportation provider with around 400 power units, has a $1.35 million unsecured claim tied to Del Monte Foods' Chapter 11 bankruptcy. The privately held company has some sizable cushion in other revenue: According to Transport Topics, the company had $922 million in gross revenue in 2024. But the potential financial hit means further pressure on a freight environment already fraught with tariff risks and rough demand. Saddle Creek didn't immediately respond to messages seeking comment. The bankruptcy, announced July 1, is poised to send ripple effects throughout the supply chain. Del Monte Foods' bankruptcy petition estimated over $1 billion in both assets and liabilities, affecting over 10,000 creditors. Other transportation creditors with unsecured claims include brokers Transplace, owned by Uber Freight ($9 million) and New Hampshire-based ES3 ($4 million) as well as Florida-based carrier CHEP ($469,812). Amid the more intense operating environment, creditors who don't have secured claims will be lower in priority for repayment and at greater risk of getting less money than what's owed. The food company believes a court-supervised sale is the best way to turnaround its finances in a long-term position, Del Monte Foods President and CEO Greg Longstreet said in a news release. 'To further enable the Company's smooth transition into Chapter 11, the Company has filed a number of customary 'first day' motions that, upon Court approval, will enable it to continue business operations in the ordinary course and on an uninterrupted basis,' the release said. Recommended Reading Early peak season signals challenging market ahead for trucking Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
09-07-2025
- Automotive
- Yahoo
How A. Duie Pyle prepared for the upcoming LTL classification shift
This story was originally published on Trucking Dive. To receive daily news and insights, subscribe to our free daily Trucking Dive newsletter. The National Motor Freight Classification changes for LTL shipments will go live July 19, 2025 and carriers such as A. Duie Pyle have been preparing for it. The industry has had ample time to adjust to the upcoming changes from the National Motor Freight Traffic Association's overhaul, as they've been working on it for several years. The changes will focus on density, so denser shipments will become cheaper while less dense ones will become more expensive. 'I believe the carriers are ready for the change to the extent they can,' John Luciani, A. Duie Pyle COO of LTL solutions, told Trucking Dive in an interview. To prepare for the upcoming changes this month from the NMFTA, Luciani said A. Duie Pyle has been very active by participating in the association's meetings and adding more dimensioners in anticipation of the classification changes. A. Duie Pyle is using the Cubiscan 1200 model. The device hangs on the ceiling, a shipment is placed into a box and the dimensioner scans and takes a picture of the freight. The picture is able to help calculate the cube of the shipments and loads the figure onto the company's ERP system, Luciani said. The Pennsylvania-headquartered company was already using these devices in its largest service centers but they did invest more in anticipation to the NMFC changes. The carrier is adding 12 more dimensioners to 22 currently in its network, Luciani told Trucking Dive. It also added second units in its larger service centers to reduce delay and travel time in its dock operations, he noted. Although not new, the company also has a research department that will aid in the upcoming changes. 'We have experts as it relates to understanding classification, the current classification system. Whether it's an item that's class 55 that has a sub item, we have a number of freight inspectors in the company that are experts in that area,' Luciani said. The members in that department handle weights and inspections. The company weighs about 85% of every outbound shipment and does dimensions to about 50% of every outbound shipment that moves in the company on a nightly basis. The impact to the industry may vary but Luciani doesn't expect any significant hangups during the first round of changes from the NMFTA. A. Duie Pyle has advised its customers that the NMFC changes are going to be a revenue-neutral event, he said. 'I don't expect a customer to tell me, 'Hey, you know, with this change, my freight bill is going to go down $40 a shipment,'' Luciani said. Or conversely, he doesn't expect to call customers and tell them their freight bills are going up $40 a shipment. 'We're a privately held, family-owned business. We have had the same family ownership all 101 years. Our pricing strategy, it's always been to charge, provide a very super competitive service, an industry leading service,' Luciani said. 'I don't expect these changes to be to be very significant, at least initially,' he added. Recommended Reading How shipping costs will change in upcoming LTL classification shift Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
