Answer extracted from the Hit The Brakes: The Can't Miss Topics in the Logistics Industry podcast — listen to the full episode below.
What contract rate increases are shippers seeing right now?
Contract freight rates are resetting this cycle with increases ranging from 5% to 10%, averaging around 7.5%. However, tender rejection rates are climbing higher than seen in years past, signaling that carriers are finding alternative opportunities and contract rates may face further upward pressure beyond these initial increases.
A supply-driven reset in contract pricing
The current rate environment reflects a fundamentally different market from the past three years of excess capacity. As Brett Leifert explains in the episode, the market has experienced the fastest climb in spot market rates ever recorded—even outpacing the surge seen during the early days of COVID. This compression comes from a coordinated exit of trucking capacity driven by regulatory enforcement, driver exits, and school closures.
The 7.5% average increase in contract rates reflects carriers' need to reset base pricing after years of unprofitable freight. Spot rates have climbed 20% to 30% higher (excluding fuel) and 30% to 40% higher (including fuel) compared to the prior year, creating a gap that carriers are eager to close through contract negotiations. Yet shippers are seeing resistance in the tendering process, a point detailed across Hit The Brakes as a structural signal of the tighter market ahead.
Why tender rejections suggest even steeper increases coming
The rise in tender rejections is the most revealing metric of all. When carriers reject contract volumes at elevated rates, it signals they have profitable alternatives—spot freight, other shipper contracts, or capacity allocated elsewhere. This is not normal carrier behavior in a soft market. discussed at length in this podcast, these rejections create a compounding effect: shippers must raise their contract offers further to secure the capacity they need, and the cycle repeats.
The implication is clear: the initial 5–10% increases may only be the opening position. Shippers facing rejection rates higher than historical norms should prepare for additional resets in the coming months, particularly as Q3 and Q4 demand typically strengthens and carriers gain even more negotiating power.
"This is truly a supply driven recovery. Demands have some green shoots, but it's really more about the exit of capacity."
Brett Leifert — Director of Innovation and Strategy, Fetch Freight. Leifert analyzes supply chain market trends, capacity dynamics, regulatory impacts, and freight demand patterns across the North American trucking market. He provides regular market forecasts and webinar analyses on trucking industry conditions for shippers navigating volatile freight cycles.
The current reset stands apart from typical annual rate adjustments. The episode also explores how DOT Blitz Week enforcement actions doubled and tripled rates on affected lanes, highlighting how regulatory actions compound capacity pressure at the operational level.
See also
What inventory dynamics are emerging in U.S. retail, and what freight demand implications do they signal?
Inventory-to-sales ratios in the U.S. are now at their lowest point since early COVID around 2021, setting up an inventory super cycle that will drive freight demand forward.
How is AI-driven data center infrastructure development affecting freight demand in the flatbed sector?
Flatbed freight demand is being driven by AI-related data center buildouts and multi-billion dollar data center developments, with steel and components flowing to these construction projects.
What is the connection between electronic logging device fraud and artificially inflated freight capacity?
Electronic logging devices, manufactured by over 100 different companies and mostly self-certified by manufacturers, have enabled fraud where drivers and carriers can mask true utilization and inflate apparent capacity.