Despite current weakness in trucking and transportation markets, freight brokers are relatively optimistic about business conditions in the months ahead, according to a survey from freight marketplace Truckstop and Bloomberg Intelligence, released today.
The Bloomberg/Truckstop semi-annual freight broker survey revealed that more than 60% of freight forwarders, third-party logistics services (3PL) providers, broker agents and others expect demand for their services to grow over the next six months. This comes in the face of weaker demand, falling rates, and increased competition, and is based on sentiment that a market turnaround may be in sight. “Despite fewer spot opportunities and moderate economic activity, brokers remain fairly optimistic, with about 61% surveyed expecting demand growth over the next six months,” Lee Klaskow, senior freight transportation and logistics analyst at Bloomberg Intelligence, said in a statement announcing the survey results. “Freight-broker sentiment is becoming less bleak as spot-rate conditions might be nearing a bottom and an economic soft landing may be achievable.” The survey polled nearly 200 industry professionals about conditions in the first half of 2023, as well as their six-month outlook. Most reported weaker conditions through the first half of 2023: Nearly half of respondents said their business volume fell in the first half of the year compared to the same period a year ago, with an average decline of about 2%. Roughly 35% of respondents said volume grew in the first half of the year, however—due mainly to newer businesses gaining share and to customer-specific opportunities. Respondents also said they think spot market rates may be near bottom, reporting that spot rates excluding fuel surcharges have fallen 31% since peaking at the end of 2021 and are down 13% from last year’s levels. About 46% of those surveyed said they expect spot rates to rise over the next three to six months, which is 18 percentage points better than the group’s second half of 2022 survey, which marked a low in sentiment. The news came on the heels of a positive report Tuesday from the monthly Logistics Managers’ Index (LMI), which measures industry sentiment among logistics managers nationwide. The August LMI registered 51.2, up nearly six points compared to the July reading and marking the first time in three months that business conditions have expanded across the industry. The LMI dipped below the 50-point mark indicating growth in May and remained there in June and July, which marked an all-time low reading of 45.4. The LMI researchers said it’s unclear whether or not August’s expansion was a “one-off deviation” from the recent market declines or if it marks a pivot back toward more typical industry growth rates, although they said there are glimmers of hope. “When taken together with other anecdotal evidence and metrics … it seems that a move back toward continued expansion is quite possible,” according to the August LMI report.
