3 Things to Watch in Freight: U.S. Bank

With the new administration in place, there has been an array of supply chain-related news and headlines. Here are three things to watch in freight, according to experts at U.S. Bank.

1. U.S. ports cap off 2024 with record container volumes

The Port of Los Angeles recorded a 24% volume increase from a year earlier in December. On a yearly basis the port reported a nearly 20% increase over 2023, which was the second-best year in the port’s history. Much of the December boost was due to retailers frontloading shipments to get ahead announced or potential tariffs. Other ports reporting double-digit YoY increases included Long Beach (21.3%), Seattle-Tacoma (15.8%) and the Georgia Ports, up 20.6% from a year ago.

2. Homebuilding could get more expensive

Planned tariffs on the nation’s closest trading partners could threaten to raise U.S. home construction costs. The proposed 25% tariffs on goods from Canada and Mexico, which might be enacted this month, could make building a typical home as much as $29,000 more expensive, with nearly half of that due to lumber prices. Canada, the U.S.’s biggest foreign lumber supplier, has already been dealing with higher duties on its shipments that started last summer.

3. Freight truckers may find silver lining, despite Q4 GDP miss

The recent fourth-quarter GDP report revealed that the U.S. economy grew at a slower rate than expected. Despite this, consumer spending remained strong, especially on durable goods, which contributed positively to the GDP, suggests continued robust demand. This scenario of low inventory levels coupled with high consumer demand is expected to drive carrier rates higher, creating a favorable economic environment for freight truckers as the market stabilizes.