A sagging industrial economy and global trade uncertainty continue to constrain less-than-truckload demand, but carriers are still pushing through rate increases. The LTL rate-per-pound component of the TD Cowen/AFS Freight Index is expected to reach a record high during the third quarter, a quarterly report showed on Tuesday.

Third-party logistics company AFS Logistics and financial services firm TD Cowen are forecasting their LTL rate index to climb to a level that is 65.9% higher than a January 2018 baseline. That would be 170 basis points above the second quarter reading and 130 bps above the prior peak set during the freight boom that concluded in 2022.

If the forecast holds, the index would be up on a year-over-year comparison for a seventh straight quarter.

“The continued resilience of the rate-per-pound index shows the effect of carrier pricing discipline, and the upcoming NMFC [National Motor Freight Classification] transition to a density framework should equip carriers with another method to tightly manage freight classification and pricing,” said Aaron LaGanke, vice president of freight services at AFS, in the report.

(Changes to the National Motor Freight Traffic Association’s classification system will take effect on Saturday.)

Cost per LTL shipment fell 2.9% y/y in the second quarter but weight per shipment was off 5.1% y/y, “indicating that carriers are holding firm on pricing and emphasizing revenue management strategies,” the report said.

Sequentially, cost per shipment was down 1.6% but weight per shipment (down 1.8% from the first quarter) and fuel surcharges (down 1.3%) were headwinds, which were offset by a 3.6% increase in length of haul.

The report is in line with second-quarter updates in early June that showed LTL carriers continued to realize y/y yield increases in April and May.

Truckload data from the index, however, continued to show depressed trends.

The TL rate-per-mile component of the TD Cowen/AFS index is expected to decline 40 bps sequentially in the third quarter to just 5.6% above the 2018 baseline. That would mark 10 straight quarters of trough-like conditions for the pricing dataset after peaking at 25.7% in the first quarter of 2022.

Truckload linehaul cost per shipment was up 1.7% sequentially in the second quarter, but the increase was driven by a 1.8% uptick in miles per shipment.

“Ongoing trade and tariff uncertainty is hampering the truckload market’s recovery from the freight recession that started three years ago,” the report concluded.

The LTL earnings season kicks off on July 25 when Saia (NASDAQ: SAIA) reports second-quarter results before the market opens.