LTL Rates Hit 8-Year High in Q3, Expected to Rise Further

Less-than-truckload rates have hit new record highs in the third quarter and are projected to climb even further by year-end, according to the TD Cowen-AFS Freight Index. The rate-per-pound metric finished Q3 at 78.8% above its January 2018 baseline, with forecasts showing a rise to 82.5% by Q4. This represents structural inflation across the carrier industry, driven by sustained diesel fuel prices, increased operational costs (wages, insurance, maintenance), and carriers' ability to enforce pricing increases in a favorable market. The surge reflects both immediate cost pressures and a longer-term recalibration of the trucking market.

Diesel prices jumped 31% year-over-year in July, 46% in August, and 68% in September, translating directly into higher fuel surcharges (up 79% year-over-year in September). Large carriers like Saia have begun pulling forward general rate increases, with Saia implementing a 7.1% hike three months earlier than initially scheduled. This acceleration signals carrier confidence in sustained pricing power and suggests shippers should expect continued upward pressure through the fourth quarter and beyond. For supply chain professionals, this trend has immediate implications for cost management and procurement strategies.

Shippers relying on spot market LTL services face the steepest pressure, while contractual negotiations may need to account for higher baseline rates. The increase also reflects freight diversion from truckload (TL) markets, where rates are simultaneously climbing at 19.7% above 2018 baseline levels, indicating capacity constraints across both LTL and TL segments.