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Market Update February 2025

Industry Market Trends

GENERAL MARKET TRENDS

Fuel Index:
  • Diesel National Averages:
    • This Week: $3.359/gallon
    • Last Week: $3.715/gallon
    • Weekly Change: $0.056
    • Year-over-Year Change:  $0.208

Summary: Diesel prices have dropped 5.6 cents week-over-week and are down 20.8 cents year-over-year, offering slight relief for carriers. The Midwest and Gulf Coast saw the largest declines, while the West Coast remains the most expensive region. However, upcoming tariffs on steel, aluminum, and electronics could drive fuel demand higher, with analysts forecasting a 5-10% diesel price increase if enacted. This would likely push up freight rates, particularly in long-haul and cross-border lanes, as shippers adjust sourcing strategies. While fuel prices remain lower than last year, ongoing geopolitical risks and supply chain shifts could lead to volatility in Q2 2025.

Reference: Gasoline and Diesel Fuel Update – U.S. Energy Information Administration (EIA)

RPM Monthly Movers:
  • National RPM Month-to-Month Changes:
    • Dry Van Markets (December – January) $0.05
    • Reefer Markets (December – January) $0.07
    • Flatbed Markets (December – January) $0.06

POTENTIAL MARKET DISRUPTORS

Seasonal Trends:

  • While post-holiday softening is typical in Q1, freight markets will gradually heat up by mid-Q2, especially in Reefer and Flatbed segments. Shippers should plan capacity ahead of peak surges, especially for perishables and construction-related freight.

Mexico Tariffs Delayed:

  • The proposed tariffs on imports from Mexico have been postponed by one month, delaying immediate cost impacts.
  • Businesses relying on cross-border trade should use this time to adjust procurement strategies and prepare for potential increases.
  • Freight Implications: Delays may cause a spike in volume next month as shippers attempt to move goods before tariffs take effect.

Winter Weather Disruptions Ongoing:

  • Severe storms in the Great Lakes and Northeast continue to disrupt freight flow, with delays on I-90, I-81, and I-94.
  • Southern California flooding has impacted I-5 and US-101, leading to temporary rerouting.
  • Freight Implications: Carriers should factor in transit time delays when planning shipments to and from affected areas.

Cargo Theft Risks:

  • High-value shipments (e.g., electronics, consumer goods) face heightened risks during winter delays.
  • Preventive Measures: Secure trailers with ISO-compliant seals, use GPS tracking, and avoid leaving freight unattended in high-theft areas.

MARKET PREDICTIONS

Capacity Trends:

  • Dry Van: Stable with inventory rebalancing; Q2 demand growth expected from CPG and e-commerce replenishment.
  • Reefer: Volatility persists—Valentine’s Day spikes floral shipments in February, Easter demand sustains volumes in March-April, and early produce seasons in CA, FL, and MX tighten capacity into Q2.
  • Flatbed: Demand rises March-June with infrastructure projects, residential construction, and industrial shipments driving volume in TX, Southeast, and Midwest corridors.

Rate Trends:

  • Dry Van: Gradual growth into Q2, supported by steady Midwest restocking and evolving consumer spending patterns.
  • Reefer: Seasonal surges drive fluctuations; rates tighten in Miami, LA, and key Midwest/Southeast markets.
  • Flatbed: Rising demand for steel, lumber, and construction materials will push rates higher in Houston, Atlanta, and Chicago.

Post-January Market:

  • Capacity Rebalancing:
    • After the brief easing of capacity in January, market conditions in February are expected to tighten slightly in response to restocking activity and infrastructure recovery projects, particularly in warmer regions.
    • Ongoing winter weather in the Midwest and Northeast may temporarily strain capacity, causing regional rate fluctuations.
  • Trade and Tariff Updates:
    • Tariffs on Key Goods: The proposed tariffs on steel, aluminum, electronics, and agriculture products, originally set to take effect this month, have been postponed by one month. While this provides temporary relief, businesses should remain prepared for potential cost increases if these tariffs are enacted in the coming months.
    • Impact on Freight: While the delay in tariff implementation provides a short-term buffer, increased costs for imported materials could still lead to higher domestic shipping volumes as companies adjust sourcing strategies.
  • March Freight Market Outlook:
    • Transitional Period: February serves as a bridge month between post-holiday softness and seasonal demand ramp-ups in March.
    • Reefer Volatility: Seasonal fluctuations persist, with produce seasons in California, Florida, and Mexico driving capacity shifts into Q2.
    • Flatbed Recovery: Capacity will tighten as construction projects gain momentum in warmer regions, particularly in Houston, Atlanta, and Chicago.
    • Potential Rate Volatility: Tariff discussions and geopolitical factors may create spot rate fluctuations if businesses accelerate freight movement ahead of policy changes.
    • Intermodal & Port Activity: The West Coast remains a key import hub, absorbing excess volume as businesses adjust logistics flows.

SEASONAL TRENDS AND CONSUMER DEMAND

Holiday and Produce Impacts:

  • Dry Van: Retail Inventory Rebalancing: Post-holiday shipments are winding down, with Q1 typically seeing a transition as inventory levels adjust from peak-season highs. Expect moderate demand for CPGs and durable goods, with inventory restocking occurring in major regional hubs; E-commerce & Distribution: While online shopping volumes decline post-holidays, warehouse replenishment remains steady, sustaining consistent dry van demand in urban fulfillment zones; Key Markets: Midwest (Chicago, Indianapolis), Southeast (Atlanta, Charlotte), Texas (Dallas, Houston)
  • Reefer: Valentine’s Day & Early Spring Produce: Flower shipments from Miami and Los Angeles peak in early February, driving short-term Reefer demand. Simultaneously, Mexico and Southwest U.S. produce seasons continue, increasing load volume for perishables such as strawberries, citrus, and leafy greens; Easter-Driven Perishable Demand: Reefer volumes will climb into March as eggs, dairy, candy, and specialty meats move ahead of the holiday;  Expect higher outbound rates from food processing hubs in the Midwest and Southeast; Key Markets: Florida (Miami, Orlando), California (Fresno, Los Angeles), Midwest (Chicago, St. Louis)
  • Flatbed: Construction Ramp-Up: Warmer regions such as Texas, Georgia, and the Midwest will see rising demand for steel, lumber, and construction materials as infrastructure projects resume; Manufacturing & Industrial Freight: Equipment and machinery moves are projected to increase in March, leading to more Flatbed loads from major industrial centers; Key Markets: Texas (Houston, Dallas, San Antonio), Midwest (Chicago, St. Louis), Southeast (Atlanta, Birmingham)

Record Cargo Theft in 2024

  • Cargo theft incidents surged 27% YoY, with over 3,625 reported thefts, the highest level on record.
  • High-Risk Areas: The largest spikes occurred in California (+33%) and Texas (+39%), particularly in Los Angeles, Dallas, and San Bernardino.
  • Targeted Goods: Criminals are increasingly targeting consumer electronics, copper products, and high-value food items (avocados, nuts, protein powders).
  • Freight Implications: Shippers and carriers should implement increased security measures, including GPS tracking, ISO-compliant trailer seals, and avoiding high-theft areas for parked freight.

Transportation Events

Upcoming Holidays

Manifest 2025: The Future of Logistics, February 10th – 12th, 2025

RILA Retail Supply Chain Conference, February 16th – 19th, 2025

Air Cargo Conference, March 2nd-4th, 2025

TMP25 – Trans-Pacific Maritime Conference, March 2nd – 5th, 2025

ProMat 2025, March 17th- 20th, 2025

Gartner Supply Chain Symposium/XPO, May 5th – 7th, 2025

Procurment & Supply Chain LIVE: Chicago, June 4th – 5th, 2025

Valentine’s Day, February 14, 2025

President’s Day, February 17th, 2025

Easter Sunday, April 20th, 2025

Memorial Day, May 26th, 2025

BM2 NEWS

BM2 Freight successfully completed 451 drop trailer shipments in January, helping our customers avoid delays and keep their supply chains running smoothly despite severe winter weather challenges. By leveraging our drop trailer network, we provided flexible, efficient solutions when they were needed most. This is just another example of how BM2 anticipates challenges, adapts, and delivers for our customers, no matter the conditions.

BM2’s commitment to our customers runs deep. In January, we absorbed $90K in losses across 300+ shipments to ensure our contracted lanes were covered, despite massive market rate increases caused by severe winter weather. When others shy away from losses or give freight back, BM2 steps up and delivers. Keeping our promises isn’t just a priority, it’s who we are.


 

INDUSTRY NEWS TO KNOW

CargoNet | The cargo theft prevention and recovery network

State of Freight Today (ftrintel.com)

US ports by volume: How maritime cargo trends are stacking up | Supply Chain Dive

Gasoline and Diesel Fuel Update – U.S. Energy Information Administration (EIA)

CargoNet | The cargo theft prevention and recovery network

Cargo Theft Surges to Record Levels as Holiday Season Approaches, Verisk CargoNet Analysis Shows | Verisk

Exclusive | Holiday heist diverts $1M in toys on 3 different trucks in new type of scam

Canada diesel prices, 23-Dec-2024 | GlobalPetrolPrices.com

Truck Tonnage Index (TRUCKD11) | FRED | St. Louis Fed (stlouisfed.org)

All Employees, Truck Transportation (CES4348400001) | FRED | St. Louis Fed (stlouisfed.org)

Producer Price Index by Industry: Truck Trailer Manufacturing: Truck Trailers and Chassis, Axle Rating 10,000 Pounds or More (PCU3362123362121) | FRED | St. Louis Fed (stlouisfed.org)

E-Commerce Retail Sales (ECOMSA) | FRED | St. Louis Fed (stlouisfed.org)

United States LMI Logistics Managers Index (tradingeconomics.com)

The Cass freight index | FRED Blog (stlouisfed.org)

United States Building Permits

Worldwide Retail Ecommerce Forecast 2024 Midyear Update (emarketer.com)

Farmer’s Report – Produce Prices & Market Trends | US Foods

US_2024.pdf (usda.gov)
2024 Supply Chain Risk Trends Analysis | CargoNet

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