The logistics and supply chain landscape is a complex ecosystem impacted by countless factors, from geopolitical events to the price of soybeans. A recent discussion featuring Dean Croak, a chief analyst at DAT, delves into the nuances of these influences, focusing on unexpected indicators such as cardboard demand and freight trends. For businesses across manufacturing, retail, and supply chain management, this analysis offers valuable insights into navigating current market uncertainties and planning for the future.

The Invisible Indicators of Economic Health

The freight market’s behavior is often a barometer for economic health, and surprisingly, one of the key indicators is corrugated cardboard. Cardboard, used for shipping everything from small consumer goods to major appliances, reflects the pulse of retail and industrial demand.

Decline in Cardboard Demand: A Warning Sign

Croak highlights that nearly half of surveyed cardboard box producers report worsening demand compared to prior quarters. For example:

Corrugated cardboard shipments dropped by 2.1% year-over-year in Q1 2025.
Major suppliers like International Paper and WestRock saw declines of 5% and 4.5%, respectively, in U.S. box shipments.

While these may seem like isolated data points, they indicate potential trouble in broader economic sectors. A decline in packaging materials suggests a slowdown in retail and manufacturing activities - key drivers of freight demand.

The Ripple Effect on Freight

The cardboard slump is not occurring in isolation. Other freight-related sectors, such as flatbed loads for construction materials and over-dimensional hauls for farming equipment, are also experiencing stagnation or declines. Croak notes that:

A lack of soybean purchases from China has suppressed commodity prices, impacting the farm machinery industry.
A drop in home construction due to high interest rates has curtailed demand for roofing materials, drywall, and other building supplies transported by flatbeds.

Together, these trends paint a picture of a freight market that is "stuck" and struggling to find upward momentum.

Uncertainty: The New Normal

Croak emphasizes that we are navigating uncharted waters in global trade and economic policy. Unlike past challenges, today’s supply chain operators face a confluence of factors that exacerbate uncertainty:

Geopolitical Risks: Tensions among global powers like China, India, and Russia are reshaping trade flows.
Tariffs and Trade Policy: Fluctuating tariffs continue to disrupt supply chains. A pending Supreme Court decision on the legality of certain tariffs could either stabilize or further destabilize markets.
Interest Rates: Persistent high rates deter growth in construction and manufacturing, key sectors for freight.

The cumulative effect is a freight industry that is essentially "grinding it out" - neither collapsing nor expanding. Croak describes it as a market where "the uncertainty has become the norm and not the exception."

The Role of Resilience

Despite these challenges, the discussion underscores the resilience of the U.S. economy and the trucking industry. Historically, both have weathered downturns and emerged stronger. However, Croak warns that prolonged uncertainty could erode confidence in supply chains, delaying recovery.

Why Demand Is the Key to Recovery

One of Croak’s central arguments is that demand - not supply - is the primary driver of change in freight markets. Efforts to reduce capacity, such as eliminating underperforming drivers or cutting back on fleet sizes, are unlikely to create significant shifts. Instead, the focus must be on stimulating demand by fostering economic stability.

For example:

Trade Policy Certainty: Clear trade rules encourage manufacturers to invest in production, generating freight activity.
Interest Rate Adjustments: Lower rates could spur construction and home buying, benefiting flatbed and dry van carriers.
Consumer Confidence: A confident consumer base drives retail purchases, increasing the need for freight services.

Until these conditions improve, the market will continue to move sideways, with no significant recovery in sight before mid-2026.

Cardboard and Beyond: Other Indicators to Watch

In addition to cardboard, Croak highlights other subtle economic indicators that logistics professionals can monitor:

Pallet Orders: A drop in wooden pallet demand often signals reduced shipping activity.
Food Truck Activity: The vitality of food trucks near warehouses and industrial hubs can provide anecdotal evidence of economic health.
Employment Trends: Slower hiring among shippers and longer job searches indicate hesitancy in the market.

These micro-level observations can serve as early warning signs of broader economic shifts, helping businesses stay ahead of the curve.

Trucking Industry Generosity Amid Hard Times

While economic conditions remain challenging, the trucking community continues to demonstrate remarkable generosity. From participating in Toys for Tots to raising funds for Special Olympics and autism awareness, truckers are finding ways to give back despite their own struggles.

Preparing for and attending truck shows, for example, requires significant effort, often after grueling 60-70 hour work weeks. Yet, these events highlight the resilience and camaraderie of the industry, offering moments of celebration even during tough times.

Key Takeaways

Cardboard Demand as an Indicator: Declining cardboard shipments signal potential slowdowns in retail and manufacturing, impacting freight.
Global Uncertainty: Geopolitical tensions, tariff policies, and high interest rates are creating unprecedented challenges for supply chains.
Demand Drives Recovery: Economic stability and increased consumer confidence are essential to reviving the freight market.
Micro-Indicators Matter: Observing trends like pallet orders, food truck success, and hiring patterns can offer valuable insights.
Trucking Resilience and Generosity: Despite challenges, the trucking community continues to support charitable causes and celebrate its enduring spirit.

The freight industry is at a critical juncture, shaped by macroeconomic shifts and micro-level decisions. Businesses in manufacturing, retail, and logistics must stay informed, adaptable, and prepared to pivot as market conditions evolve. By focusing on demand generation and building resilience, the supply chain sector can navigate uncertainty and emerge stronger.

Source: "In-Depth Market Trends & Transportation with Dean Croke | DAT Freight & Analytics" - RadioNemo, YouTube, Sep 5, 2025 - https://www.youtube.com/watch?v=JtlAz4yVhH0

How Cardboard and Freight Trends Signal Demand Shifts