Shipping costs have risen to a new high of 14 quarters, and smaller carriers can’t take it anymore first

According to AFS Logistics and TD Cowen’s weekly report, the freight rate in Q2 hit a new cycle high, and may continue rising in Q3. Rising diesel prices and tight capacity pushed the per-mile rate to a 14-quarter high; Q2 was 16% higher than the 2018 benchmark, and Q3 could rise to 17.7% above the benchmark. Over the past year, more than 48k non-compliant drivers have exited the market, and smaller carriers may temporarily suspend operations due to economic and fuel pressure. Andy Dyer, CEO of AFS, said that smaller carriers with tight profit margins may shut down, waiting for fuel prices to fall to more acceptable levels.