Nov US LMI down driven by softening of inventory, warehousing metrics

Similar to dynamics observed in October, this slowdown is driven by a continued softening of inventory and warehousing metrics, but tempered by some expansion in transportation.

Unlike in October, the downward pressures slightly exceeded upward momentum in November. This is headlined by warehousing utilisation, which is down by 9 points to 47.5, marking the first time in the nine-year history of the index that this metric has contracted.

Never before have LMI respondents reported that they were using less available warehousing space month on month. This shift is a product of the continued rundown of the large stocks on inventories that were built up through the first nine months this year that has led to a softening in the warehouse market, an official release said.

This softening was seen in an increase of 2.8 points in available warehousing capacity to 54.8—the highest since April and a drop of 4.8 point in warehousing price expansion to 62.9—the lowest since March.

While inventory levels did move back into mild expansion (plus 3 points) at 52.5, inventory cost expansion was down by 2.4 points to 70.8.

Transportation markets are continuing the upward trend, with transportation capacity dipping by 4.5 points to 50 and no movement. This is the lowest rate of expansion since September 2024 and only the third time this metric has read no movement since March 2022, when the freight market flipped.

Transportation prices are up by 3.2 points to 64.9, which is their fastest rate of expansion since February. The 14.9-point spread between transportation prices and capacity is the second largest since April 2022—behind only January 2025. Taken together, these metrics suggest that the freight market is relatively healthy in November.

Transportation price metrics in November 2025 are mainly driven by downstream retailers and grew faster in the first half of the month than the second. This suggests that the improvement in transportation metrics are likely tied to the seasonal movement of inventories to retailers, meaning they could recede again should dynamics change post-holidays.

Researchers at Arizona State University, Colorado State University, Florida Atlantic University, Rutgers University, and the University of Nevada, Reno, and in conjunction with the Council of Supply Chain Management Professionals issued the LMI report.

ALCHEMPro News Desk (DS)