Freight volumes are falling almost everywhere — dry van, refrigerated, and flatbed alike — and yet rates keep climbing. While this is contrary to what transpires in a regular market season, eight straight months of capacity contraction is not typical either. This supply destruction has meant carriers have pricing power, even as shippers move less freight than they did a year ago.

This edition looks at how tightening capacity is reshaping the market: record contract rate increases at DAT, a widening spread between truckload and intermodal costs that’s pushing shippers toward rail, and a Logistics Managers’ Index still holding near a four-year high even as it cools from June’s peak.

Capacity Falls Faster in July as Rates Hold Firm

The Logistics Managers’ Index showed transportation capacity contracting at nearly its fastest pace in the survey’s 10-year history in July, with utilization and pricing both cooling slightly from June’s highs but remaining historically elevated. The broader index is still running near a four-year peak.

Carriers are already capturing the upside. Werner Enterprises trimmed its one-way truckload fleet while revenue per truck climbed sharply, and its operating ratio improved meaningfully. Schneider National reported double-digit rate increases on one-way contract renewals — a sign that, as truck hiring stays weak, carriers are choosing discipline over expansion.

Tight Capacity Pushes Rates Higher Even as Volumes Fall

FTR’s Trucking Conditions Index slipped again in June, reflecting a market in which fewer trucks are chasing less freight. Dry van and refrigerated contract rates both moved higher in July, even as volumes fell across dry van, reefer, and flatbed. Spot rates continued to outpace contract rates, a pattern that typically indicates a tighter market.

“Spot rates moving ahead of contract rates have historically signaled a tightening market, but we haven’t seen a capacity-driven market quite like this one,” said Dean Croke of DAT. FTR’s Avery Vise added that the market should stay favorable for carriers throughout the firm’s two-year forecast, even as the recovery stabilizes.

DAT Contract Rates Post Record June-to-July Rebound

DAT’s own benchmark told a similar story from a different angle: dry van, refrigerated, and flatbed contract rates all posted gains from June to July, even as volumes declined across every equipment type. Refrigerated freight saw its steepest June-to-July volume drop in years.

“When rates rise quickly as volumes fall, it indicates available capacity is exerting greater influence on pricing,” Croke said. In other words, the carriers still in the market are setting the terms.

Intermodal Shift Widens as Trucking Costs Climb

The rate gap between truckload and rail is now wide enough to change routing decisions. Domestic intermodal demand is climbing at a double-digit clip while long-haul truckload tender volumes sit flat. On several major lanes, truckload contract rates have jumped far faster than intermodal rates over the same stretch, making rail the more attractive option for shippers that can afford the longer transit time.

FreightWaves analyst Zach Strickland called the spread too great for many shippers to overlook, but also warned it’s “unsustainable,” building on the pricing pressure we flagged when retailers pulled peak season forward earlier this summer.

Dry Van Capacity Stays Tight as LMI Holds Near Four-Year High

Spot linehaul rates are easing slightly week over week, but are still running well above both last year’s levels and the long-run seasonal average. Load availability relative to truck capacity also loosened a touch, and tender lead times stretched further as shippers commit earlier to secure trucks.

July’s LMI reading, while down from June, still tops every monthly reading recorded from 2023 through 2025. Capacity has now contracted for eight straight months, and with diesel prices holding well above year-ago levels, elevated rates look likely to carry into the fall.

What Tightening Capacity Means for Shippers

Across every one of these reports, the theme is the same: capacity, not demand, is the scarce resource right now. That makes planning lead time, carrier relationships, and real-time visibility more valuable than ever — shippers who wait to book are the ones absorbing the biggest rate jumps.

At Entourage Freight Solutions, we build our full truckload and refrigerated programs around exactly this kind of market. Our cloud-based GPS platform tracks every shipment in real time, reroutes loads on the fly to avoid delays, and adjusts to market conditions as they shift. Combined with our freight management support, we help shippers lock in capacity and protect margins before the next rate jump hits.

Request a quote to see how we can help you navigate a tightening market.