With 20%-25% of U.S. surface freight involved in international trade, tariffs are set to extend the for-hire freight recession. While recessionary effects of the trade war are still to come, ACT Research expects higher cost equipment as a result of tariffs to eventually tighten capacity and help end the long for-hire freight recession, according to the latest release of the Freight Forecast: Rate and Volume OUTLOOK report.

“As Q2 begins, retail sales are still brisk as consumers snap up pre-tariff prices, but freight demand fundamentals face major self-inflicted tariff headwinds. The pre-tariff inventory stocking period will soon reverse, and consumption will fall as prices rise,” shared Tim Denoyer, ACT Research’s Vice President and Senior Analyst. “We expect a few more months of brisk demand for pre-tariff goods, followed by a tariff adjustment period with lower goods demand. Freight is very much in the crosshairs of the trade war.”

“The trucking industry also faces considerable supply shocks related to new US government policy. Both equipment and labor supply are affected, and this is likely to press truckload rates up after tariffs take their toll,” Denoyer concluded.

The monthly 61-page ACT Freight Forecast report provides analysis and forecasts for a broad range of U.S. freight measures, including the Cass Freight Index, Cass Truckload Linehaul Index, and DAT spot and contract rates by trailer type for the U.S. and Canada. The service provides monthly, quarterly and annual predictions for the TL, LTL, and intermodal markets over a two- to three-year time horizon, including capacity, volumes, and rates. The Freight Forecast provides detail on the freight rate outlook, helping companies across the supply chain plan with greater visibility and less uncertainty.