August 2022 Freight Market Update

08/15/2022 by Greg Massey

August 2022 Freight Market Update

Stay up to date on the latest information on conditions impacting the freight market, curated by Trinity Logistics through our Freightwaves Sonar subscription.

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One indicator of the freight market activity that is gaining traction is the Logistics Manager’s Index. If we look at one component of that index, Transportation Prices, as indicated by the blue line, you will notice the steep downward trend over the past three months.   

As with any index, it is not an actual price or rate, but 50 and above represents the point of growth. As you can see in Figure 1.1, the blue line (LMI) dipped below 50 for the first time since the bottom fell out in the Spring of 2020. If you look at the green line, which is the van rate per mile average from, as the LMI goes, so goes the carrier buy rate.

August freight market update, figure 1.1
Figure 1.1 * Note: blue line represents LMI, and the green line represents the Van RPM from 

Two things that are noteworthy: first, the LMI, while it is below the 50 mark, is just barely below 50 at 49.5. Secondly, the last third of July was above 50, but the first two-thirds of the month was not. So, while the month blended average was 49.5, one could argue that the latter part of July will be the point at which the index has started to rebound.  

One would think this shows potential, as we will start to see several events happening such as back-to-school shopping and the holiday buying season, that will create upward movement in the freight market and the Logistics Manager’s Index as we close out 2022. 


Speaking of carrier rates, relatively speaking, rates continue to remain high, certainly in comparison to what they were just a few years ago. Inflation and the elevated cost of diesel fuel are two of the primary reasons.  

In Figure 2.1, you will see the at-the-pump rate that most small- and medium-sized carriers pay illustrated by the blue line, currently at $5.18 per gallon. While a high price, it is about $0.60 less than what it was a few months ago.   

The green line represents the rack or wholesale price. Typically, large carriers are beneficiaries of rack pricing as buying in bulk, which smaller carriers just are not able to do, yields savings.  As you can see, that drop in rack pricing has been quicker than the at-the-pump price, so an advantage to those carriers that have wholesale versus retail fuel costs. 

August freight market update, figure 2.1
Figure 2.1 *Note: blue line represents retail diesel price, the green line represents wholesale/rack price per gallon 


Finally, many remember seeing a picture like the one in Figure 3.1 through most of 2021.  

August freight market update, figure 3.1
Figure 3.1 

Well, the backlog of ships is not just occurring on the west coast, but the east coast is now seeing the waters just off the coastline become a parking lot for inbound ships.   

Right now, there are more ships waiting to offload across all U.S. ports than there ever have been. Expect activity around these port hotspots to ramp up over the next several weeks, putting pressure once again on the supply chain in getting goods into the hands of consumers. 


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