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MODE INSIGHT Transportation Market Overview

TRUCKLOAD

INTERMODAL

LTL

PARCEL

S E P T E M B E R 2 02 6

INTERNATIONAL

TRUCKLOAD Truckload Market Update As we enter Q4 2026, freight markets are showing improved pricing power, but the recovery remains supply-led rather than demand-led. National truckload tender rejections averaged approximately 13% in mid-August, while spot rates strengthened seasonally ahead of Labor Day. Freight brokerage sentiment has improved sharply, with near-term profitability reaching +52.13 on a -100 to +100 scale and no surveyed broker expecting to reduce headcount this quarter. However, the survey base is weighted toward smaller brokerages, so the results should be viewed as a directional indicator rather than a complete view of the market. The primary rate consideration is the widening gap between purchased transportation and contract pricing. Capacity is tightening as smaller carriers exit the market and contracted carriers reject more tenders, pushing additional freight into the spot market. C.H. Robinson raised its full-year dry van spot-rate forecast to a 34% yearover-year increase while expecting truckload linehaul costs to rise 29%. This environment may create opportunities for brokers and shippers with strong carrier networks, but it also increases the risk of buying capacity at a loss where customer pricing has not kept pace. Fuel is an additional source of Q4 volatility. National diesel prices reached a record $5.97 per gallon in early September and were reported above $6 shortly afterward, while crude oil exceeded $100 per barrel. Higher fuel costs are already flowing through transportation pricing: the Producer Price Index for general freight truckload increased 1.8% month over month and 23.9% year over year, although fuel surcharges account for a significant portion of recent trucking revenue growth. Spot rates typically soften after the Labor Day peak, but elevated fuel costs and constrained capacity could limit the seasonal decline. The 12-month brokerage profitability outlook of +49.71 is slightly below the near-term reading, suggesting a plateau rather than a rapid recovery. Rate power is available to firms with dependable capacity and pricing discipline; the key differentiator will be the ability to secure compliant carriers and absorb higher operating and technology costs. *Sources: FTR, State of Freight Insights; Sonar Broker Rate Report

September 2026 MODE Insight

TRUCKLOAD Truckload Market Update

Source: Sonar.Surf

September 2026 MODE Insight

INTERMODAL Intermodal Market Update Peak season surcharges have increased in Southern California and added in Northern California; these surcharges are expected to remain in place until at least mid-December. The industry continues to see many truckload shippers convert to intermodal for cost savings, freight security and capacity. Regulatory changes continue to impact dray capacity for intermodal loads as drivers leave the trucking industry. Drayage companies are increasing rates and being more selective with the loads being accepted. 2026 intermodal rates are increasing 8.8% while 2027 rates for intermodal are expected to increase 4.8% without fuel surcharge. Fourth quarter 2026 volume projections are expected to finish at 4.3% with domestic containers being the primary factor for growth. Volume projections for 2027 are currently sitting at 2.8%, with both domestic and international containers driving volume gains.

September 2026 MODE Insight

LTL LTL Industry News Here are links to some top stories in the industry for you to check out:

TFI’s autonomous LTL linehaul logic is sound, analysts say

Saia’s tonnage growth steps higher in August as comps ease

ODFL posts solid August operating metrics

Averitt expands logistics network with Jackson, Mississippi, facility

LTL Market Update As we move into September, the LTL market continues to show signs of improvement, but the recovery remains uneven. August carrier results reinforce that point. Saia reported an 8.7% year-over-year increase in tonnage, while Old Dominion remained slightly negative at 0.9%. The broader takeaway is that freight is beginning to move in the right direction in parts of the market, but we are not seeing a broad surge in demand. Manufacturing continues to provide some support. The August ISM Manufacturing PMI remained in expansion territory for the eighth consecutive month, although growth moderated from July. Production remained strong, while new orders slowed. For LTL, this remains an important indicator given the industry's exposure to industrial and manufacturing freight. Pricing pressure is becoming a bigger part of the story. Carriers continue to push for yield improvement even as overall shipment growth remains mixed. Old Dominion reported quarter-to-date revenue per hundredweight up 4.8% year over year excluding fuel, while Saia implemented a 7.1% general rate increase in July. This suggests carriers remain focused on pricing discipline rather than chasing volume as the market improves. Fuel is adding another layer of pressure. Diesel averaged approximately $5.46 per gallon in August, up roughly 46% from a year ago. Higher fuel surcharges are increasing total transportation costs at the same time base rate pressure is building, making cost management and carrier selection increasingly important for shippers. Heading into the final month of Q3, the market is healthier than it was earlier in the year, but there is still enough available LTL capacity to handle additional freight. The question now is whether improving manufacturing activity and seasonal demand can create more consistent volume growth through the fall. If they do, the combination of firmer carrier pricing and higher fuel costs could make the LTL market noticeably more expensive heading into Q4.

September 2026 MODE Insight

LTL UPDATE NMFC Changes Put Greater Focus on Shipment Data SOURCE: Transport Topics, “LTL Carriers Urge More Shipper Education on NMFC Changes,” Keiron Greenhalgh, August 14, 2026. More than a year after the National Motor Freight Classification (NMFC) system shifted toward density-based classification, LTL carriers say the transition has gone relatively smoothly, but many shippers are still struggling with the fundamentals. The July 2025 changes moved more than 2,000 NMFC items from traditional commodity-based classifications to a 13-tier sub-provision density scale designed to more closely align freight class with the actual characteristics and cost of handling a shipment. According to carriers, the bigger challenge today isn't the new classification system itself. It's incomplete or inaccurate shipment information. Incorrect freight descriptions, dimensions, weights and bills of lading can lead to reclassification, rebills and additional costs for shippers. Carriers are also investing more heavily in dimensioning technology. Better dimensional data and shipment photos allow carriers to validate freight characteristics and make more efficient use of trailer space, making accurate shipment data increasingly important throughout the LTL process. What This Means for MODE Global The NMFC transition reinforces something we've been focused on across our LTL business: clean shipment data matters. For MODE and our customers, getting the freight description, dimensions, weight and NMFC information right at the beginning of the shipment helps create a cleaner transaction from quote through final invoice. As carriers continue expanding dimensioning and freight-validation technology, the room for inaccurate or incomplete shipment information will continue to shrink. This creates an opportunity for MODE to help customers understand the changes, improve the quality of the data entering our systems and reduce avoidable reclasses, rebills and disputes. It also reinforces the value of strong carrier relationships, technology and disciplined shipment execution as the LTL market becomes increasingly data-driven.

September 2026 MODE Insight

LTL UPDATE United States ISM Manufacturing PMI The ISM Manufacturing PMI registered 54.6 in August, down from 55.6 in July but remaining in expansion territory for the eighth consecutive month. The slower pace was driven largely by a pullback in new orders, while production remained relatively strong. Employment also moderated during the month, pointing to more cautious hiring across the manufacturing sector. Cost and supply chain pressures remain key concerns. The Prices Index stayed elevated at 71.1, while Supplier Deliveries increased to 59.3, indicating longer delivery times and continued pressure on supply chains. Backlogs and imports also softened, suggesting some moderation in future demand. Manufacturers continue to cite higher costs, tariffs, geopolitical uncertainty and supply-chain disruptions as challenges heading into the fall.

Source: Trading Economics & Federal Reserve

Fuel The U.S. national average cost per gallon for on-highway diesel in August 2026 came in at approximately $5.46, which is $0.51 (10.2%) higher than July 2026's average of approximately $4.96. August 2025's average was approximately $3.74, putting August 2026 about $1.72 (45.9%) higher year over year. The latest weekly reading, for the week ending August 31, came in at $5.60 per gallon, approximately $0.14 (2.5%) above the August monthly average.

September 2026 MODE Insight

PARCEL Surcharges Arrive Early, Dimensional Rules Widen and Fees Extend There are three topics worth flagging before peak season planning conversations start, and none of them are about rate cards. Peak Season Surcharges are already live earlier than in any prior year, the fee structure itself is shifting against ordinary ground shippers, and the surcharge window now stretches deep into January. Let’s dive into the details:

1. Peak season surcharges are already live, a month earlier than 2025 UPS surcharges took effect September 27, with FedEx following a day later on September 28 and USPS peak pricing beginning October 4, a full four weeks ahead of 2025's October 26 start. The core peak window itself doesn't open until November 23 and runs through December 27, but by the time it does, surcharges will already have been in effect for nearly two months. An estimated 46% of holiday shoppers plan to start buying before November, which means shippers are moving volume into a fee structure that's already active, not one they can simply wait out. Clients who haven't budgeted for this yet need to hear it now. Surcharges are already active, weeks ahead of the October timeline they may be expecting.

2. Dimensional and residential fee changes hit ordinary ground shippers hardest Two structural shifts compound the earlier start. Carriers have widened their cubic-size rules this year, pushing more standard-sized boxes into the “Additional Handling” category and its associated surcharge. That change catches shippers who haven’t re-measured packaging against the new thresholds. At the same time, fees on ordinary residential ground packages are rising two to three times faster than fees on bulky freight, reversing the usual assumption that oversized or heavy shipments carry the greatest cost risk. This is a good time to recommend clients audit packaging dimensions before the wider dimensional rules stack with peak surcharges. It's one of the highest-value conversations to have this month.

September 2026 MODE Insight

PARCEL UPDATE 3. Surcharges stack through mid-January, and returns bring a second peak The surcharge window doesn't close with the holidays. USPS peak surcharges run through January 17, 2027, and the last date to ship Ground for a December 24 delivery is December 16. Ship-by dates vary by origin, destination and service level, so confirm specifics against each carrier's published guarantee schedule. Return volumes then spike in the first two weeks of January, effectively creating a second peak. Clients need reverse-logistics capacity in place before December, not after. On the upside, early volume commitments give clients real leverage. Carriers use them to plan trailers, sorts and route capacity, and shippers who commit now are better positioned once capacity tightens in November. Carrier Surcharge Timeline: 2026 Surcharges begin four weeks earlier than 2025, and the tail runs into mid-january

4. Client readiness checklist Four things worth prioritizing this week, in this order: Audit packaging now: avoid new dimensional fees before they compound. Lock in ship-by dates: December 16 is the Ground cutoff for December 24 delivery*. Optimize service mix: compare air vs. ground options for cost and speed tradeoffs. Budget for stacked fees: surcharges run through January 17, 2027. *Ship-by dates vary by origin, destination, and service level. Confirm specifics against each carrier's published guarantee schedule. Sources: FedEx, UPS, USPS peak season announcements.

September 2026 MODE Insight

INTERNATIONAL Key Trends Volume: August containerized imports from Asia grew by 3.7% compared to July and 1.5% year-on-year. Volumes are predicted to slow moving through Q4. Rates: Asia-to-U.S. rates continue to rise fueled by solid U.S. import demand but also substantial congestion and service disruptions due to typhoon and storm activity. Capacity: More than 11% of the global containership fleet is at anchor due to port congestion, weather events and ongoing volume challenges.

Rates Transpacific container freight rates rose to new highs moving into September, supported by peak-season demand that has remained unexpectedly firm despite the earlier-than-usual start to the traditional timeline. Asia-U.S. West Coast prices increased 2% to $7,621 per FEU according to the Freightos Index. Asia-East Coast rates increased 2% to $9,791. Current FAK rates reflect the challenges seen in the Asia Pacific region, including broad port congestion and substantial disruption being caused by a series of typhoons/storm activity. Various indexes report Asia-East Coast levels on September 1 at a 4-year high of nearly $11,000 per FEU from Southeast Asia ports to the U.S. East Coast. Due to possible scrutiny by China’s Ministry of Transport, carriers have been reluctant to raise rates by large amounts (as they did during the COVID era), opting for smaller increments of $300-500 per FEU. We are also once again seeing some lines reintroducing “Premium” level surcharges and booking cancellation fees.

September 2026 MODE Insight

INTERNATIONAL UPDATE Rates (continued) Asia to West Coast rates remain firm, but extra loader vessel deployments have released some of the pressure and allowed some of the carriers to maintain lower spot rate levels.

Asia to U.S. East Coast 3-month trend

Asia to U.S. West Coast 3-month trend

Aggregated market average spot rates – September 3, 2026 Far East to U.S. West Coast: USD 7,496 per FEU Far East to U.S. East Coast: USD 10,910 per FEU Aggregated market spot rate changes from August 27, 2026 Far East to U.S. West Coast: +2.5% Far East to U.S. East Coast: +1.6% Some carriers are considering low-water surcharges for Panama Canal transits. If implemented, those charges could place added upward pressure on rates to the U.S. East Coast, particularly for services that depend on transit through the canal. The direction of rates through the remainder of September will depend on whether Far East port congestion eases, the scale of Golden Week blank sailings and whether carriers can maintain capacity discipline as the traditional peak-shipping period progresses.

September 2026 MODE Insight

INTERNATIONAL UPDATE Volume/Demand (continued) Despite the record-breaking mid-summer spikes seen in July, total containerized import volumes through the first seven months of 2026 hovered roughly flat—tracking down about 0.9% year-over-year. The National Retail Federation (NRF) projects total 2026 volume will end flat compared to the previous two years at around 25.5 million TEUs. Analysts report that U.S. import demand may have benefited from the absence of additional tariff increases in July, reducing one source of disruption to U.S.-bound imports. Increased ocean shipments of data-center hardware also appear to be supporting volumes. There are also reports that tariff refunds may have allowed some importers to lower prices and could be improving expectations for consumer demand.

Inbound container volume is now likely shifting into a typical late-season slowdown earlier than normal, since the traditional August/September peak was effectively pulled forward into May/June. The forward-looking volume forecast for the remainder of Q4 2026 and heading into Q1 2027 suggests a steady downward slide in demand. The only caveat to that is the current severe congestion in many of the primary Asia origins. If import orders continue to be significantly delayed (as they are currently), the higher volume cycle could be extended as delayed orders roll forward.

September 2026 MODE Insight

INTERNATIONAL UPDATE Capacity/Supply As reported in recent updates, the global container ship fleet is officially crossing 34 million TEUs for the first time in September 2026, which equates to a 42% growth in total capacity since 2021; however, despite this fleet growth, "effective capacity" remains severely constrained. Roughly 5% of deep-sea capacity (~1.7 million TEUs) is completely absorbed by vessel delays and scheduling disruptions. A series of severe typhoons in Asia has heavily disrupted vessel rotations, intensifying significant backlogs at major Chinese hubs. The Premier Alliance (O.N.E., Yang Ming, HMM) PS-6 service – connecting North and Central China and the PSW with vessels of 11,000 TEU capacity – has not called the port of Qingdao since late July and will continue to skip Qingdao for the rest of September. Similar rolling port omissions are happening in Ningbo, Shanghai, Haiphong, Yantian and Ho Chi Minh (Cai Mep) as carriers and shippers face delays of up to 16 days versus planned/scheduled rotations. Shanghai alone had over 100 container vessels in queue to berth as of August 24, with many opting to skip altogether. Several Asia-U.S. East Coast services are, in some cases, 300% overbooked, including backlog from weeks of disruptions. Though forecasted blank sailings are still at modest levels, the worsening displacement of vessels should guarantee an aggressive number of blank sailings (we predict over 50% of market capacity) by early October.

September 2026 MODE Insight

Insight September 2026