A new Logistics Managers' Index (LMI) report shows that while the logistics industry continued to expand in July, the freight market remains stuck in a sustained "holding pattern."

• The overall LMI dipped to 59.2, a 1.5-point decline from June's 60.7, signaling moderate but decelerating expansion in logistics activity.

• Within transportation segments, capacity edged upward to 52.6, but utilization and rates surged to 59.5 and 63.0, respectively. This means that pricing, not improved capacity is fueling the market recovery.

Inventory & Warehousing Trends

• Overall inventory levels fell modestly, through smaller and upstream forms reported elevated warehouse inventories many had stocked up ahead f anticipated tariff changes.

• Warehouse capacity rose slightly to 51.1, but utilization softened to 59.4. Meanwhile, warehouse prices held steady, indicating continued demand pressure.

Market Sentiment & Outlook

• Respondents projected transportation pricing could climb to 75.5 over the next 12 months, understanding elevated expectations for rate growth

• Reports highlight a growing disparity: smaller, upstream logistics players like wholesalers and distributors continue stockpiling inventory while larger retailers are releasing inventory to manage costs and maintain lean, just-in-time operations.

SSAF Insights & implications

For SSAF clients and stakeholders, this snapshot offers a clear strategic lens:

• Spot market strength over capacity growth: With capacity barely expanding but utilization rising, spot rates remain the primary growth lever. Asset owner may find increased yield opportunities, especially if willingness to turn down contracted loads persists.
• Segmented performance by firm size: smaller companies are carrying more inventory and driving logistics expansion. larger retailers in contrast are drawing down stocks. those providing services to middle-mile segments may see stronger demand.
• Warehouse pricing resilience: stable or rising warehouse rates suggest continued tightness in facility options even amid mixed utilization making warehouse agreements a key negotiation point.

The logistics sector continues to grow overall, but there is limited help coming from new capacity. Instead, freight firms are leaning on pricing gains and tightening utilization to sustain momentum. For SSAF clients, this translates to opportunities in spot freight, asset deployment and targeting segments where inventory and warehousing demand remained high.