US Logistics Costs Hit 246.1 as Transport Prices Top 90 Again

A cost plateau, not a peak

US logistics costs went up quickly after the war with Iran began. Since then they have stayed high instead of falling back. Bloomberg made that point in early September. It reported that aggregate logistics costs, meaning what businesses pay for inventory, warehousing and transportation, had stayed near 240 on the Logistics Managers' Index (LMI) since the US-Israel invasion of Iran in February, which added to concern about "supply-driven inflation."11 The September survey, released October 6, shows the pressure is not easing. Aggregate logistics costs rose 2.5 points to 246.1, and all three cost components went up.2229

The headline index tells the same story. The LMI rose 3.6 points to 70.2 in September from 66.6 in August. That is the second-highest reading in four years, behind only June's 71.1, and well above the index's all-time average of 61.8.2221 The survey's authors tie the change directly to the war. The index averaged 68.8 in the six months since the conflict began, compared with 58.5 in the 12 months before it.22

This looks less like a temporary spike than a new, higher baseline. The aggregate cost reading peaked at 250.9 in May, its highest since March 2022, according to LMI commentary republished at the time.13 It has stayed in the mid-240s since. The survey treats 150 as the breakeven level for that measure.27 Logistics Plus notes that readings above 240 have historically coincided with supply-driven inflation.23

Where the reporting diverges

The coverage agrees on direction but not on every number. DC Velocity called September's 70.2 the index's highest level in four years.28 The LMI report and most other outlets rank it second, behind June.2229 Logistics Plus described 246.1 as the highest aggregate cost reading since April 2022.23 That is hard to square with the 250.9 reported for May.13 The measured reading is the one in the LMI's own release: costs are elevated and rising again, but slightly below the spring peak.22

Smaller differences appear too. Intek Logistics put transportation capacity at 34.3 and counted transportation prices above 90 for the sixth time this year.25 The LMI release gives capacity as 34.4.22 Logistics Plus and Fibre2Fashion say prices topped 90 for the fifth time in six months.2326 None of these differences changes the overall picture.

Freight: tight capacity, very high prices

Transportation is the main source of the cost pressure. The transportation prices index rose 2.7 points to 92.7 in September, on a scale that tops out at 100.2223 In May it reached 96.0, the fastest rate of expansion recorded for any metric in the index's nearly ten-year history. Smaller respondents reported 98.2 that month.13

Capacity is moving the other way. Transportation capacity fell 5.6 points to 34.4 in September, its tenth straight month of contraction.2223 That reverses some of August's relief. Holman's weekly commentary noted that capacity had loosened to 40.0 that month, from 28.4 in July, yet prices still climbed to 90.0.19 Prices rising while capacity loosens suggests the cost problem is about fuel, not just a shortage of trucks.

The diesel figures support that view. Average US diesel reached $6.83 a gallon in the last week of September. The three highest readings ever recorded all came in the month's final three weeks, and prices are up more than 70% since the Iran conflict began.23 J.B. Hunt warned of a 5–10% headwind to third-quarter earnings because fuel surcharges lag behind actual costs. The G-7 has agreed not to ban diesel exports and to release 100 million barrels from strategic reserves.23 Earlier in the cycle, the LMI described the Strait of Hormuz closure as the trigger for unusually fast price growth. It said US supply chains had kept working even though about 20% of the world's oil exports were disrupted.13

The same disruption is hitting tankers. Oilprice.com reports that moving crude from the US Gulf Coast to Europe now costs about $24.50 a barrel, up from roughly $4 before the war. Shipments from the Americas to Asia cost more than $40 a barrel. As a result, heavy crude from Canada, Colombia and Ecuador is stuck in an oversupplied regional market, while the diesel shortage continues elsewhere.18

Container rates: high, but split by route

Ocean container shipping is part of the same story, though the picture is more mixed. Drewry's World Container Index (WCI) rose 3% to $4,485 per 40ft container on October 15. That ended three straight weekly declines, mainly because Asia-Europe rates went up.1 On the transpacific route, Shanghai to Los Angeles rose 3% to $7,884, while Shanghai to New York slipped 1% to $10,075.110 Drewry said strong US import demand is keeping transpacific rates high.3

Compared with a year ago, the change is large. In early October the composite was 166% above its level a year earlier. Shanghai–Los Angeles was up 257% and Shanghai–New York up 226%.9 One tracker shows the index at a low of $1,651 in October 2025 and a high of $4,526 on August 21, 2026. The biggest jump came between late May and late July.4

The main difference between the two big trade routes is the Suez Canal. Ships returning to the canal are adding capacity between Asia and Europe. Rates on that route fell for 13 straight weeks before this week's rebound. Carriers are trying to push freight-all-kinds rates up to $4,500–$4,800 effective October 19, but Drewry says it is unclear whether they will succeed.3 Suez transits in week 39 were 68% higher than a year earlier.7 US-bound shippers have no comparable relief. Their rates rely on import demand, and there is no route change adding capacity. The extended US–China trade truce could also add to demand.57

Warehouses fill up ahead of the holidays

September also brought a sharp shift in storage. Inventory levels jumped 6.1 points to 58.9. Warehousing capacity fell 14.2 points to 39.3, swinging from mild expansion to strong contraction.22 Logistics Plus calls this the fastest contraction in four and a half years. Smaller firms, which tend to be wholesalers, were hit hardest at 36.0.2322 The LMI authors put the inventory build down to goods arriving late on newfound confidence in fourth-quarter spending. They also point to a newer pattern in which retailers hold off receiving goods until mid-October.22 The Port of Los Angeles projects imports up about 50% year over year in the first two weeks of October.23

Inventory costs rose to 79.9. Survey respondents attribute that to tariffs and fuel.22 The gap between inventory costs and inventory levels has become a lasting feature of this cycle. In May it reached 29.2 points, the widest in the index's history.13 In practice, holding goods costs much more even when companies are not holding many more of them.

Why it matters: the inflation question

The big concern is whether these costs show up in consumer prices. In June, LMI commentary noted that the last comparable run of high logistics costs came before the highest US inflation in 40 years.13 Producer prices posted their largest monthly gain in four years in April.14 By September, the Federal Reserve had raised rates for the first time in three years. Meanwhile, consumer confidence fell to its lowest since April 2014, and the economy added only 29,000 jobs.23

Final-mile and parcel costs point the same way. AFS Logistics and TD Cowen project fourth-quarter ground parcel costs per package up 5.8% from a year earlier. FedEx's holiday surcharge on residential packages rises to $0.80 from November 23.17 A FarEye survey found median last-mile costs rose 12% in 2026, matching last year's increase. Its CEO now calls near-double-digit annual increases the new normal.19

Part of this predates the war. The Council of Supply Chain Management Professionals put total US business logistics costs at a record $2.6 trillion in 2024, about 8.7% of GDP.15 One analysis estimated that ratio at 7.4–8.0% before the pandemic.12 The war has added a fuel shock on top of an already higher base.

The outlook: little relief priced in

Logistics managers do not expect conditions to ease. Over the next 12 months, respondents expect transportation prices at 86.1, inventory costs at 81.3 and warehousing prices at 72.4. They expect transportation capacity to keep shrinking at 37.9.2829 Their forecasts for the overall index have been unusually stable, between 68.6 and 70.6 since June.22

The most likely scenario is that costs stay at about this level for some time. Container rates on routes into the US depend on import demand, diesel depends on the Strait of Hormuz, and warehouse space is tight going into peak season. The relief now appearing on Asia-Europe routes as ships return to Suez has no equivalent for US shippers. Until fuel prices fall, the higher cost level is more likely to carry through into 2027 than to drop back.