Freight capacity challenges from the first half of 2021 will continue into the second half of the year, according to a forecast from logistics firm 3PL and supply chain solutions provider Transportation Insight.
Conditions will remain tight across the major transport modes, including less than truckload (LTL), truckload, and international ocean routes, the report found.
LTL traffic will see a continued capacity crunch and possible rate increases, the report forecasts.
“Conditions are unlike anything the market has experienced,” said Transportation Insight’s Chris Mendenhall. “Many major carriers are not accepting new business. Fuel surcharge averages are trending upward to 22 percent.”
The truckload sector also faces capacity issues and rate increases, and truck and driver shortages are contributing to astronomical spot rates—already up 61 percent on average.
“All indicators point toward a full truckload environment with tighter capacity and elevated truckload contractual and spot rates continuing to [the] third quarter,” said James Mathews, also with Transportation Insight.
International ocean shipping disruption will continue through peak season. Port congestion on the U.S. West Coast is slowly improving, but shipping costs that are already at historically high levels will increase “in a substantial way” over the quarter, officials from 3PL said.
Demand for air freight is also rising, driving up costs as capacity issues build.
Source: Supply Chain Quarterly