While recessionary effects of the trade war are still to come, higher cost equipment is expected as a result of tariffs to eventually tighten capacity and help end the long for-hire freight recession, as per ACT Research’s report titled ‘Freight Forecast: Rate and Volume Outlook report’.
“As Q2 begins, retail sales are still brisk as consumers snap up pre-tariff prices, but freight demand fundamentals face major self-inflicted tariff headwinds. The pre-tariff inventory stocking period will soon reverse, and consumption will fall as prices rise,” said Tim Denoyer, ACT Research’s vice president and senior analyst. “We expect a few more months of brisk demand for pre-tariff goods, followed by a tariff adjustment period with lower goods demand. Freight is very much in the crosshairs of the trade war.”
“The trucking industry also faces considerable supply shocks related to new US government policy. Both equipment and labour supply are affected, and this is likely to press truckload rates up after tariffs take their toll,” added Denoyer.
ALCHEMPro News Desk (SG)
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