Contract Rates Hit $2.72/Mile, Up 18% Year Over Year

Why are contract rates climbing now?

Contract truckload rates hit a 52-week high of $2.72 per mile plus fuel in early October, up 18% year over year. Spot rates climbed nearly 50% over the same period, narrowing the gap between contract and spot and giving carriers leverage as annual bids roll over. The move signals shippers are no longer holding the line on legacy pricing.

The NTI index shows spot rates rising sharply while contract rates reset at elevated levels. When spot and contract converge, carriers gain pricing power in negotiations. Fleets renewing agreements this fall are locking in rates 18% higher than last year's contracts.

Tender rejections remain range-bound at 13.75%, inside a recent 13% to 14% band. Truckload demand ticked up approximately 1.25% week over week in early October, returning to pre-Labor Day levels after a brief post-holiday pullback, according to Julie Van de Kamp during a FreightWaves SONAR market update on October 9.

What's driving the rate reset?

The contract-spot spread is compressing. When spot rates run 50% higher year over year while contract rates climb 18%, the gap that kept shippers on legacy pricing disappears. Carriers walking into bid season with spot leverage can push for higher contract floors.

Demand is steady but not surging. The 1.25% week-over-week uptick in truckload volume puts freight back at pre-Labor Day levels, not above them. The rate movement is capacity-driven, not demand-driven. Fleets that exited the market in 2023 and 2024 have not returned, and those still running are holding the line on pricing.

Tender rejections at 13.75% sit well above the sub-5% levels that marked the 2023 freight recession but below the 20%-plus peaks of 2021. The current band suggests balanced but tight capacity. Carriers are accepting most loads but have enough selectivity to push rates higher.

Gulf Coast disruptions spike local rejections

Tropical Storm Isaías is creating localized disruptions along the Alabama Gulf Coast and the Florida Panhandle. Tender rejections and spot rates have risen noticeably in the Mobile and Montgomery, Alabama markets over the past several days, with inbound truckload rejections into both markets climbing sharply relative to the national average, Van de Kamp noted.

FreightWaves' Weather Optics tool is tracking the storm's projected path and landfall timing, with the Business Impact Index showing moderate-to-elevated disruption risk across the affected region. Van de Kamp said the Business Impact Index is among her preferred tools for assessing storm-related freight risk, alongside road closure and power outage overlays available in the module.

For fleets running Gulf Coast lanes, the storm adds short-term rate volatility on top of the broader contract reset. Spot rates in Mobile and Montgomery are spiking as carriers reject tenders and shippers scramble for available trucks. The disruption is localized and weather-dependent, but it compounds the leverage carriers already hold in a tightening market.

Intermodal benchmarks now available in SONAR

FreightWaves released intermodal rate benchmarks within the SONAR Rate Intelligence module. Users can now view available lanes, nearest rail ramps, and cost comparisons versus van in both contract and spot formats, joining van, refrigerated, and flatbed as available modes in the tool.

The addition matters because intermodal has been siphoning long-haul freight as truckload rates climb. Fleets competing for long-haul loads now face a modal alternative that shippers can price in real time. The SONAR module gives carriers visibility into what shippers see when they compare truckload to rail.

What this means for a 10-truck fleet

If you're renewing contracts this fall, you have leverage. Spot rates running 50% higher year over year and contract rates at $2.72/mile give you a floor to negotiate from. Shippers resetting agreements are paying 18% more than last year, and the gap between contract and spot is narrow enough that walking away from a lowball bid is a viable option.

Watch the contract-spot spread. When spot rates climb faster than contract rates, the gap widens and shippers delay resets. When contract rates catch up, as they are now, shippers lose the incentive to wait. The current convergence favors carriers in bid season.

Gulf Coast lanes carry short-term premium but weather risk. If you run Mobile or Montgomery, rejection rates and spot rates are spiking as Isaías moves through. The premium is real but temporary. Plan for volatility and price accordingly.

Intermodal is a competitor, not a customer. The new SONAR benchmarks give shippers a tool to compare your truckload rate to rail. On long-haul lanes where intermodal is viable, your pricing needs to account for the modal alternative. Shippers can now see the cost difference in real time, and they will use it in negotiations.