{"id":95114,"date":"2026-02-19T21:39:42","date_gmt":"2026-02-20T00:39:42","guid":{"rendered":"https:\/\/shipping.einnews.com\/article\/893904493"},"modified":"2026-02-19T21:39:42","modified_gmt":"2026-02-20T00:39:42","slug":"state-of-freight-five-takeaways-a-strong-market-likely-sticking-around","status":"publish","type":"post","link":"https:\/\/new7.shop\/zerocostfreehost\/index.php\/2026\/02\/19\/state-of-freight-five-takeaways-a-strong-market-likely-sticking-around\/","title":{"rendered":"State of Freight five takeaways: a strong market likely sticking around"},"content":{"rendered":"

The February State of Freight webinar was the third consecutive event where after months\u2013years, really\u2013of talking about weak freight markets<\/a>, the discussion was once again about one that was increasingly strong.<\/p>\n

And as FreightWaves and SONAR CEO Craig Fuller and SONAR Zach Strickland looked out over a radically different freight landscape than just three to four months ago, it raised the inevitable question: does this rally have legs?<\/p>\n

The answer from both of them was unequivocal: yes, it does.<\/p>\n

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That was one of the conclusions from this month\u2019s discussion. It\u2019s one of five takeaways from the February two-person roundtable held Thursday.<\/p>\n

The strengthening market isn\u2019t going to fade away <\/strong><\/p>\n

\u201cThe big disagreement in the market is why and how is this sustainable,\u201d Strickland said in the opening minutes of the discussion. <\/p>\n

Fuller chimed in that \u201cthere is no disagreement that this is a very different market today. The big disagreement is why and how it is sustainable.\u201d<\/p>\n

Fuller believes it is. He noted that conditions that might have temporarily made the market tighter in late January and early February are out of the market, including the impact from the storms that hit the Northeast and parts of the South in late January, are out of the market. And yet the strength continues.<\/p>\n

\u201cIt is still very, very tight and we\u2019re in a situation where the market has not gone back to where it was before,\u201d Fuller said. <\/p>\n

Snapshots of several iterations of the Outbound Tender Rejection Index (OTRI) in SONAR were shown in the presentation, with the primary national index hitting about 12.2% at the end of December, sliding back slightly through much of January but then soaring once again to a recent number of about 13.7%.<\/p>\n

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Fuller said demand is not a \u201cmarket catalyst\u201d that is strengthening markets, owing more to tightening capacity. The current rejection rates, he said, \u201care telling us that this market is really primed for a breakout in mid-February.\u201d<\/p>\n

February, Fuller joked, is usually the time to do cat memes if you\u2019re in the business because of the lack of activity. \u201cEspecially in the second half, there\u2019s nothing that happens in February,\u201d he said. \u201cYou get a little bit of activity for the Super Bowl, you get a little bit of activity for Valentine\u2019s Day, and then from mid-February  to really early March, nothing interesting happens in freight.\u201d<\/p>\n

<\/figure>\n

Industrial activity is a big factor in the surge<\/strong><\/p>\n

Fuller and Strickland rolled out a map of rejection rates by region, with the darker blue areas showing a higher rejection rate than other parts of the country. Fuller said the tighter freight market is occurring in \u201cthe industrial parts of the economy.\u201d<\/p>\n

Fuller said the OTRI rate has always skewed toward industrial activity. Its increase \u201cis telling me that the recovery we\u2019re seeing is starting to show up in manufacturing,\u201d he said.<\/p>\n

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Discussions between SONAR representatives and their shipper clients, Fuller said, have pointed out that \u201cthis tightness in the Midwest is very unusual.\u201d And what\u2019s unusual about it is that a corresponding surge is not happening on the coasts, particularly the U.S. West Coast, where a significant amount of consumer goods is imported. (The OTRI for Los Angeles has been less than 5% for all of 2026).<\/p>\n

Quickly running through a series of Midwest cities with rising OTRI rates, Fuller noted that many of those locations provide products such as batteries, \u201cheavy equipment that goes into the auto sector and aircraft parts out of Kansas City.\u201d<\/p>\n

\u201cWe have not seen the Midwest perform like this in years when the West Coast was not,\u201d Fuller said. \u201cI can\u2019t remember the last time that ever happened.\u201d<\/p>\n

<\/figure>\n

Shippers are getting more selective and demanding quality<\/strong><\/p>\n

The tough freight market of the past few years means that some of the equipment on the road is showing its age, Fuller said. \u201cWe\u2019re not getting new capacity added in, and it means the sustainability of this market is quite good,:\u201d he said.<\/p>\n

But it also means that shippers are going to have to fight to secure high-quality capacity. Fuller spoke of products like GenLogs <\/a>that enable shippers to better screen the capacity that is in the market.<\/p>\n

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\u201cI\u2019m hearing that shippers in their RFPs for capacity in this round of bids are asking brokers to talk about their process for avoiding non-domiciled CDL owners,\u201d Fuller said. \u201cDo you have a way to screen out bad carriers? Talk about your compliance processes, talk about your fraud mitigation solutions.  What is your process for ensuring that my freight stays safe?\u201d<\/p>\n

The end result, Fuller said, is that \u201ccompanies have the tools to filter a lot of the bad actors out of the business. These bad actors aren\u2019t getting freight. So we\u2019re seeing a rally in contract rates.\u201d<\/p>\n

A drop in bankruptcies is not assured<\/strong><\/p>\n

It may seem counterintuitive, but Fuller said the current market conditions may accelerate bankruptcies. First, it\u2019s been a \u201clong, long journey of really abysmal conditions and the sins are starting to pile up.\u201d Company balance sheets \u201chave memories,\u201d he said. <\/p>\n

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In some cases, real estate and equipment assets start to rise in value as the market strengthens, with the result that a company may be more valuable broken up than continuing even in a stronger market, Fuller said. <\/p>\n

Those conditions mean that lenders can start to put pressure on their creditors, \u201cand that\u2019s going to accelerate bankruptcy.\u201d Fuller noted that the bankruptcy of Celadon in late 2019 <\/a>occurred as a weak freight market that year was starting to strengthen, not at the bottom of the trough.<\/p>\n

A strengthening market is new to some market participants<\/strong><\/p>\n

With spring 2022 generally seen as the start of the freight recession, Fuller noted that some people in the industry, brokers in particular, may never have seen rising markets and might not be primed to take advantage of the new conditions. <\/p>\n

What constitutes a great market can differ among market participants. For example, brokers have discussed how the rise in spot rates has been painful for their margins<\/a> given that they secured contract business from shippers at lower numbers.<\/p>\n

Fuller said he recently had a conversation with a CEO of a major brokerage firm. The CEO was asked how the market was. The response: not great. <\/p>\n

\u201cI asked you about the market,\u201d Fuller said. \u201cI didn\u2019t ask you about your margins.\u201d From that perspective, Fuller said, the conversation was quite different. \u201cHe\u2019s like, oh, it\u2019s great. Volumes are popping and demand is there.\u201d<\/p>\n

Shipping executives also might find themselves in a world they haven\u2019t been in for awhile. Fuller said those C-suite denizens might want to think about increasing their shipping budgets by 10%, \u201cbecause remember, you don\u2019t get to be the shipping executive if you miss your budget by a long yard. So I would ask for some real higher budgets this year.\u201d<\/p>\n

To back up that request, Fuller said a chart of the SONAR OTRI should be used. <\/p>\n

More articles by John Kingston<\/em><\/a><\/p>\n

International Roadcheck 2026: ELDs under scrutiny<\/a><\/p>\n

The high-stakes fight over New York City\u2019s renewed delivery regulation law<\/a><\/p>\n

New territory: RXO debt rating from Moody\u2019s now below investment-grade cutoff<\/a><\/p>\n<\/div>\n

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