State of Freight takeaways: sagging volume, but capacity tightening a bit

Core Insights - The freight market is expected to rebound before the end of 2025, prompting analysts to investigate the underlying causes of current trends [1] Group 1: Demand Dynamics - A significant factor affecting the freight market is a downturn in demand, which was highlighted as one of the main takeaways from the discussion [2] - The Outbound Tender Volume Index (OTVI) indicates that demand for carrier capacity is weak, with a noted decline of approximately 11% compared to the same period last year [3] - Retailers are anticipating a "soft demand or sales environment," leading them to reduce inventories rather than increase orders, which is constraining the truckload market [4] Group 2: Capacity and Rejection Rates - The Outbound Tender Rejection Index (OTRI), which measures capacity, has shown a slight increase, currently at 6.79%, compared to 6.5% last year, indicating a gradual tightening of capacity [5] - The incremental rise in rejection rates has been slow, making it less perceptible to market participants [5] Group 3: Rate Trends - Although spot rates have not yet surged, there is an expectation that they will increase significantly, with recent data showing upward movement in the National Truckload Index (NTIL) [6] - An increase in long-haul business, as suggested by OTVI data, may lead to lower rate per mile calculations, impacting overall pricing strategies in the freight market [6]