Brace yourselves for insights straight from the CNBC Supply Chain Survey. It’s a forecast for the global freight industry, and let’s just say, it’s a bit stormy out there.
Alan Baer, the Captain of OL USA, predicts a prolonged freight recession ride into 2024. There could also possibly be a lingering drift into 2025. Why? Well, the logistics sector’s capacity is outpacing the demand – it’s like having too many seats on a lifeboat. The result? Soft pricing in the shipping realm.
The trucking sector, already in financial choppy waters, foresees lower freight orders and revenue this holiday season. The CNBC Supply Chain Survey sets the stage, forecasting little to no growth in the first half of 2024. Consequently, picture stable to downward pricing vibes, not the jingle of cash registers.
The survey shows that if there is no boost in freight movement, then we can expect a soft pricing ride well into 2025. Alan Baer sums it up, “Without more freight moving, 2024, and potentially 2025, will continue to see soft pricing as capacity outstrips demand.”
Now, trucking tales – they get paid per load, and with lower expectations for orders, it’s like having fewer passengers on the freight train. Logistics executives are divided on LTL freight rates for the first quarter. As a result, half are expecting a 5% bump and the other half think rates might go unchanged to a 15% dip.
But hey, it’s not all storm clouds. The CNBC survey hints at a potential sunny outlook in the second half of 2024. Expectations are cautiously optimistic – 50% foresee a 5% increase in freight volume, while the dreamers in the group (17%) paint a picture of a 15% surge.
Brian Bourke from SEKO Logistics sums up the mood, “With a lot of uncertainty around consumer demand, interest rates, and the global economy, most people do not have a positive outlook on freight volumes in the first half of next year, but we could certainly see a rebound in the second half of next year.”
As we sail through the choppy waves of 2024, keep your eyes on the horizon for potential shifts. The shipping seas are unpredictable, but one thing’s for sure – this industry is resilient. So, tighten your knots and get ready for a journey full of surprises!