Freight Analysis: In-Depth Market Report (August -September 2025)

Executive Summary: Navigating a Rebalancing Market

The U.S. freight market in late summer 2025 is a complex and fragmented landscape, defined not by a widespread economic boom but by a prolonged and painful supply-side correction . A deep examination of market fundamentals reveals a compelling paradox: while there is a significant and sustained contraction in trucking capacity, average national spot rates have remained stubbornly flat on a year-over-year basis, or in some cases, have even declined . This disconnect signifies that the high load-to-truck ratios seen across the country are not a result of a surge in demand, but a direct consequence of a shrinking pool of available trucks . The market is actively and painfully rebalancing itself as dozens of smaller carriers, who entered the industry during the boom of 2021–2022, are now exiting at an accelerating pace .

This dynamic suggests that profitability in the coming months will not come from a broad market upturn but will hinge on strategic agility and a focused pursuit of high-yield opportunities. Success for carriers will be determined by their ability to identify and capitalize on specific regional and equipment-based niches. The top five strategic opportunities for fall 2025 are detailed below:

The Top 5 Strategic Opportunities for Fall 2025

1. Pacific Northwest Produce & Reefer Surge: With a projected record Washington state apple crop and a robust Idaho potato harvest, the Pacific Northwest is entering a seasonal peak that is expected to dramatically tighten refrigerated capacity . This predictable and powerful demand surge creates a prime opportunity for high-paying, long-haul reefer lanes to the Midwest and East Coast .

2. Southeast & South Central Flatbed: The South remains the most profitable region for flatbed freight, commanding the highest average rates in the nation . This is driven by a resilient construction sector, a continuous pipeline of federal infrastructure projects, and ongoing demand for storm recovery materials . Despite a slowdown in oil drilling activity in the South Central states, these other factors ensure a robust pipeline of high-paying loads .

3. Government & Vocational Freight: Freight associated with government-funded projects is a stable, non-cyclical source of demand that is less sensitive to macroeconomic volatility . The Infrastructure Investment and Jobs Act (IIJA) continues to fund large-scale construction, while an "above-normal" Atlantic hurricane season creates a consistent need for high-paying, short-term work for carriers with FEMA contracts .

4. Midwest Dry Van & Distribution: The Midwest has emerged as the leading region for dry van freight, surpassing the Southeast and offering the highest average rates . Its central location, diversified economy, and concentration of manufacturing and e-commerce distribution centers provide a reliable and consistent volume of freight that is less susceptible to the import-driven volatility of coastal markets .

5. Port Drayage & East Coast Dominance: The long-term shift of import volumes from the West Coast to the East and Gulf Coasts is solidifying . Ports like New York/New Jersey, Savannah, and Houston are posting consistent, multi-month growth and running at or near record levels . This sustained volume is creating strong, localized demand for drayage and short-haul transload services in these major port cities, with inland hubs absorbing much of the freight .

National Freight Market Overview: A Painful Correction

Spot Rates and Economic Fundamentals

The overall truckload spot market is not experiencing a broad-based recovery. Instead, it remains in a prolonged state of rebalancing, defined by a perplexing disconnect between high load-to-truck ratios and stagnant rates . The brief seasonal uptick in spot activity following the Independence Day holiday has faded, and the market has settled into a muted rhythm . Current national average spot rates are largely flat or down slightly from earlier in the summer. Dry van rates average $2.03 per mile, a minor dip from the $2.06 per mile seen in June . Similarly, refrigerated (reefer) rates are at $2.39 per mile, down from July's average of $2.42 per mile . Flatbed rates have likewise softened to an average of $2.50 per mile, a decline from the $2.61 per mile recorded in June .

These nominal values are only pennies above—or even slightly below—their 2024 counterparts on a year-over-year basis, indicating that the market has not yet found a new, higher baseline . This stalled rate environment is directly linked to an economy that is sending mixed signals. The manufacturing sector continues to struggle, with industrial and consumer-linked freight volumes described as underwhelming in July . A key leading indicator, the Manufacturing Purchasing Manager's Index (PMI), has slipped back into contraction after a short period of growth earlier in the year . Compounding this, trade policy remains a significant headwind. Recent tariff escalations and the suspension of the de minimis exemption are not merely abstract policies but a direct cause of supply chain disruption, forcing importers to reroute goods and contributing to inflationary pressures . The market is caught in a holding pattern, as weak consumer spending and cautious inventory strategies from retailers limit the overall volume of freight available for transportation .

Capacity and Employment Dynamics

The most significant development in the freight market is the ongoing and dramatic rebalancing of capacity. The high load-to-truck ratios that have been widely reported are not the result of a surging demand for freight, but rather a direct consequence of a shrinking pool of available trucks . Numerous small carriers that entered the market during the 2021–2022 freight boom are now exiting at an accelerating pace. Dozens of carriers, including companies with hundreds of trucks, have ceased operations in the second quarter of 2025 alone, with some opting for a quiet shutdown rather than formal bankruptcy . This capacity purge has led to a major spike in the rate of commercial bankruptcy filings, reaching its highest level in over a decade .

This capacity contraction is the primary reason for the tightening market conditions. Load-to-truck ratios have surged to historic levels year-over-year: the flatbed ratio is up an astounding 101.4%, reefer is up 84.3%, and dry van has increased by 57.3% . The table below illustrates the central paradox of the current market: while capacity is tightening at a phenomenal rate, average spot rates have remained stubbornly flat or even declined slightly from the prior year .

Market Health Indicators (August 2025)

	Van	Flatbed	Reefer
YoY Load-to-Truck Ratio Change	+57.3%	+101.4%	+84.3%
YoY Spot Rate Change	+0.0%	−0.4%	−0.4%

This data signifies a fundamental process: the market is not in a healthy growth phase, but rather a "painful, drawn-out correction phase" where supply is being forced to contract to meet an underwhelming demand environment . This explains the apparent disconnect between a tightening market and stagnant rates. The number of for-hire trucking employees is also down, with the total dropping to 1.52 million in July 2025, approximately 4% below its peak in late 2022 .

Despite these clear indicators of a challenging environment, there is a curious undercurrent of optimism among small carriers. A survey of owner-operators found that 85% believe volumes will be flat or up in the next six months . However, this positive sentiment is not yet translating into action, as only 21% of carriers plan to purchase new equipment . This divergence between hope and cautious behavior highlights a delicate holding pattern for the market . The financial pressures from low rates, rising insurance costs, and inflated equipment financing are forcing carriers to prioritize cost control over expansion, leaving the market increasingly vulnerable to a sharp, sudden upward shift in rates should demand unexpectedly surge .

Regional Freight Market Breakdown: A Fragmented Landscape

The national freight overview belies significant regional and seasonal variations. An analysis of August 2025 data reveals a fragmented market where strategic positioning is key.

Midwest: The New Powerhouse

The Midwest has emerged as a powerhouse for both dry van and refrigerated freight, offering the highest average rates in the nation for both equipment types in August 2025 . The average outbound van rate from the region is $2.16 per mile, while reefer rates average $2.62 per mile . This performance is a testament to the region's balanced freight flows, rooted in a diverse industrial base that includes automotive manufacturing, food production, and a vast network of distribution centers . The Midwest’s strength is its reliance on consistent, diversified domestic freight rather than volatile import flows that define coastal markets . This stability makes the region a "safe harbor" for carriers seeking reliable work in an otherwise uncertain environment. While some reports suggest that manufacturing activity is still subdued, the sheer density and diversity of freight keep trucks busy and rates firm . The upcoming fall grain harvest will provide a strong tailwind for bulk haulers and could further tighten capacity for other freight types as the season progresses .

Southeast: The Resilient Performer

The Southeast is a resilient and diverse freight market that continues to perform well. Its strength is not a single factor but a combination of agriculture, construction, and port activity. The region remains the undisputed leader for flatbed freight, commanding the nation's highest average rate at $2.65 per mile . This robust demand is fueled by a steady pipeline of commercial construction projects, residential development, and the movement of materials for ongoing highway and infrastructure work . The presence of new steel mills in the region also generates consistent flatbed traffic . For refrigerated freight, the Southeast's rates, at $2.14 per mile, have softened as the Florida produce season wanes and the harvest shifts north . However, the van market, anchored by major distribution hubs in Atlanta and the Carolinas, is holding steady, supported by strong e-commerce and retail fulfillment activity .

South Central: The Volatile Energy Engine

The South Central region, anchored by Texas, is a dynamic market defined by its strong links to the energy and construction sectors. Flatbed rates in the region are a close second to the Southeast, averaging $2.62 per mile . This is driven by constant demand for heavy machinery, pipe, and materials for major highway expansions and industrial projects . However, the region's profitability is also tied to commodity prices, introducing an element of volatility. Data indicates a notable 35% year-over-year reduction in drilling activity in the oil and gas sector, which has caused some Houston outbound flatbed rates to decline . This reliance on both resilient infrastructure and the cyclical energy sector makes the South Central market a more high-risk, high-reward proposition than the diversified Southeast. Cross-border trade with Mexico remains a significant component, creating steady volumes of van and reefer freight along the I-35 corridor .

Western Region: Harvest Surge & Port Recovery

The Western freight market is characterized by a rebound in port volumes and the beginning of a major agricultural season. The Port of Los Angeles reported its busiest month ever in July, handling over 1 million TEUs and signaling a recovery in West Coast trade . This surge, however, appears to be a short-term, pre-tariff bump, as other reports forecast a sharp drop-off in August volumes, and drayage at LA/Long Beach is still facing congestion and chassis-related issues . The most compelling freight opportunity in the region is tied to the start of the Pacific Northwest (PNW) produce harvest. Washington state is projecting a record apple crop, and Idaho is set for a strong potato harvest . This predictable seasonal event is already causing refrigerated capacity to tighten in key areas like Yakima, Washington, and Northeastern Oregon, setting the stage for a period of high-paying, long-haul reefer loads to the East Coast through the fall . Reefer rates in the West are currently among the highest nationally at $2.50 per mile .

Northeast: The Backhaul Challenge

The Northeast continues to be a consumption-heavy region, with a strong flow of inbound retail freight from major ports. Despite high load-to-truck ratios in pockets of the Mid-Atlantic, which might suggest a tightening market, outbound rates remain the lowest in the nation for dry vans . The average outbound van rate is just $1.86 per mile, significantly below the national average . This rate disparity is a result of many carriers deadheading out of the region or accepting low-paying backhauls to reposition for more lucrative freight in the South or Midwest . The high inbound volume, particularly from the Port of New York/New Jersey, which has seen its container traffic grow by nearly 5% year-to-date, makes the region an attractive destination . However, securing a profitable reload remains a persistent challenge for carriers without pre-existing contract lanes.

Southwest: The Pass-Through Crossroads

The Southwest is largely a pass-through region, with freight dynamics heavily influenced by seasonal shifts and transcontinental lanes. Van rates are in the middle of the national average at $2.06 per mile, but flatbed rates are the lowest nationally at $2.21 per mile, as many open-deck carriers reposition to the more lucrative Southern markets . The region's reefer market is currently in a lull, as the winter produce harvest from Arizona has concluded and the seasonal demand has shifted north . This makes for a challenging environment for carriers who are not strategically positioned to take on backhauls or long-haul loads heading east.

Strategic and Non-Cyclical Freight Opportunities

Government & Infrastructure Projects

Government-funded projects are a critical and stable source of freight demand in 2025, largely insulated from the economic volatility of the consumer and retail sectors . The Infrastructure Investment and Jobs Act (IIJA) continues to pour billions into national projects, creating a consistent need for the transport of construction materials like steel, cement, and aggregates . The U.S. Army Corps of Engineers (USACE), for example, has forecast numerous dredging, remediation, and repair projects across the Great Lakes and Ohio River Division, with individual projects valued from several million to over $250 million . This provides steady, high-margin work for specialized carriers with dump trucks and lowboys.

Another significant area of opportunity is disaster relief. With NOAA forecasting an "above-normal" 2025 Atlantic hurricane season, the risk and opportunity for freight are elevated . The Federal Emergency Management Agency (FEMA) is actively preparing by awarding advance contracts for the transport of temporary housing and other supplies . In August, FEMA also solicited bids for a new, multi-year contract worth up to $190 million for cross-docking and incident base support services . These government contracts can be highly lucrative for carriers who are on subcontractor lists for major relief firms, providing high-paying work that can completely change a fleet's revenue stream overnight should a storm hit a coastal area . This segment of the market provides a strategic alternative for carriers looking to avoid the competitive pressures of general consumer freight.

The Rise of Operational Efficiency: The 'Drop and Hook' Strategy

In an environment defined by low rates and rising costs, operational efficiency is becoming a critical differentiator. This is most evident in the increasing adoption of the "drop and hook" strategy across high-volume corridors . This operational model offers efficiency and reduced driver dwell time, and it is being increasingly adopted in major distribution hubs to smooth operations during seasonal peaks .

The growing emphasis on this strategy is a direct response to the economic pressures detailed in this report. In a low-margin environment, carriers must find ways to increase profitability without a rate increase. By minimizing the time drivers spend waiting to be loaded or unloaded, drop and hook maximizes asset utilization. It addresses the core financial squeeze that is forcing carriers to prioritize cost control over expansion . The widespread adoption of this model, particularly at port terminals, intermodal yards, and large distribution centers, is a symptom of a new market reality where operational excellence is as important as securing high-paying freight.

Intermodal, Port, and Rail Dynamics

Port Volume Shifts and Inland Activity

U.S. ports are experiencing significant shifts in container traffic, with a notable, sustained trend of freight moving toward East and Gulf Coast gateways . The Port of New York/New Jersey has been a standout, handling over 4.4 million TEUs in the first half of 2025, a 4.9% increase year-over-year . Similarly, the Port of Savannah had its second-busiest year on record, with fiscal year 2025 container volume up 9% . Port Houston reported an impressive 21% increase in container volumes for July 2025, buoyed by strong growth in both loaded imports and exports .

The table below illustrates how the East and Gulf coasts are gaining market share, a consequence of shippers diversifying supply chains to mitigate risk from West Coast labor uncertainty and adapting to new tariff policies .

Key Port Volume Comparison (H1 2025 vs. H1 2024)

Port	H1 2025 TEUs	YoY Change %
Port of New York/New Jersey	4,417,282	+4.9%
Port of Savannah (Fiscal Year)	5,700,000	+9.0%
Port of Los Angeles (YTD July)	5,975,649	+5.0%
Port of Houston (YTD July)	∼2,500,000	+5.0%

This consistent growth directly translates to strong, localized demand for drayage and regional truckload services out of these ports, with inland hubs like Dallas and Atlanta absorbing much of this freight . The significant drop in Asia–U.S. ocean container rates—down 46-58% since June —is also likely to prompt increased port throughput, driving further drayage and intermodal demand in these gateway regions.

The Strategic Impact of Rail Consolidation

A seismic shift in the intermodal sector is underway following the announced merger agreement between Union Pacific (UP) and Norfolk Southern (NS) . The transaction, valued at over $250 billion, aims to create the nation's first transcontinental railroad and promises to streamline operations by eliminating bottlenecks at key interchange points like Chicago . While the merger faces significant regulatory scrutiny and is not expected to be operational for several years, its announcement is a significant signal . This is a strategic move by the rail industry to recapture market share from trucks . Over time, this could make intermodal a more competitive alternative to long-haul trucking by improving reliability and reducing transit times . While the trucking industry is preoccupied with the current spot market fluctuations and capacity purge, the rail industry is making a long-term strategic play that merits close monitoring.

Forward Outlook & Market Watch List

Several key trends and events will shape the freight market in the coming months and into 2026:

• PNW Produce Surge: The market will closely monitor the PNW apple and potato harvests through September and October . This is the most predictable seasonal event on the horizon and is expected to create a sharp spike in reefer rates on lanes to the East Coast.

• Hurricane Season Activity: The peak of the Atlantic hurricane season is underway . A major storm landfall would immediately disrupt freight flows and create a sudden surge in high-paying emergency and debris-hauling work, completely altering the regional capacity landscape .

• Carrier Exits and Capacity Rebalancing: The ongoing purge of small carriers is the primary driver of market tightening . The market is now in a fragile state, and continued exits could flip the market balance by early 2026, causing a sudden and significant spike in spot rates should demand unexpectedly surge . This trend is expected to continue as carriers prioritize managing cash flow over expanding their fleets .

• Evolving Tariff and Trade Policies: New tariff escalations are actively disrupting global supply chains and causing importers to shift trade routes . This uncertainty will likely continue to fuel the shift of import volumes to East and Gulf Coast ports and increase the importance of domestic, regional freight flows .

• Rail Consolidation Impact: While the Union Pacific/Norfolk Southern merger is a long-term strategic move, its announcement is a significant signal . Over time, this could increase rail's competitiveness against trucking, especially on long-haul lanes, and it merits close monitoring from a strategic perspective .

Final Takeaway & Actionable Recommendations

September 2025 is shaping up as a transitional moment: spot freight is incrementally strengthening, harvest and pre-holiday demands are tightening capacity, and operational efficiency is becoming a strategic asset. The market's central paradox—a tightening supply in a low-demand environment—is a painful, but necessary, correction that is driving the weakest carriers from the market. This process creates a fragile system where any unexpected increase in freight volume could lead to a swift and dramatic increase in spot rates. The professional and analytical carriers that recognize this dynamic are not focused on a broad-based recovery but on strategic positioning in high-yield, stable segments of the market.

Actionable Recommendations

For Carriers

• Focus on High-Yield Niches: Seek out the predictable, high-paying opportunities identified in this report, particularly the Pacific Northwest produce surge, Southeast flatbed lanes, and stable government contracts.

• Prioritize Operational Efficiency: In this low-margin environment, profitability depends on maximizing asset utilization. Implement strategies like drop and hook in key distribution corridors to reduce driver dwell time and improve turnaround.

• Exercise Caution: The market is still in a delicate holding pattern. Avoid aggressive expansion and instead prioritize managing cash flow, reducing operational costs, and securing profitable freight in strategic lanes.

For Shippers & Brokers

• Prepare for Volatility: While rates are currently low, the ongoing capacity purge means the market is highly vulnerable. Any unexpected demand spike could lead to a swift and significant increase in spot pricing.

• Diversify and Secure Capacity: Partner with professional, established carriers who are better equipped to handle a volatile market and have a clear strategy for profitability. Recognize that the cheapest carrier today may not be in business tomorrow.

Top Opportunities by Freight Type (August 2025 Regional Highlights)

Freight Type	Top Regions & Insights
End-Dump & Bulk Hauling	The South and Southeast are the top regions. The combination of IIJA-funded highway projects and the consistent need for disaster debris removal makes this area a "goldmine" for dump truck operators . Drop-and-hook operations can maximize cycle efficiency.
Refrigerated (Produce & Meat)	The West Coast and Midwest are the most profitable regions. The West is entering its peak fall harvest season, with the record Washington apple crop expected to drive a significant and predictable tightening of capacity . Midwest rates are currently the highest nationally, supported by a strong and consistent flow of meat and dairy freight .
Dry Van (General Retail & E-commerce)	The Midwest has taken the lead as the top dry van market in August 2025, offering the highest average rates nationally . Its central location and diversified freight base provide more stability and better yield than the more volatile Northeast . The Southeast remains a close second due to its thriving e-commerce distribution networks .
Flatbed (Construction, Machinery, Steel)	The Southeast and South Central regions are "flatbed heaven" . While the oil and gas sector in the South Central is cooling, the construction and industrial projects in the Southeast are keeping demand and rates exceptionally high . These regions command the highest flatbed rates in the country, with average rates over $2.60 per mile.
Intermodal Drayage (Ports & Rail Hubs)	The East and Gulf Coasts are the prime locations for drayage. Port volumes in New York/New Jersey, Savannah, and Houston are running at or near record levels, creating a strong, sustained demand for local and regional truck moves . The adoption of drop-and-hook operations reduces dwell time at busy terminals.

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