Logistics and trucking are the lifeblood of the global economy.
There are some major trends and challenges that could affect both pallet demand and palletization trends.
Let’s look at some of the recent data and market analysis to see how things have been taking shape over the last two years. The 36th annual State of Logistics report authored by Kearney, a leading consulting agency, found that the global logistics industry last year returned to pre-pandemic patterns in some areas regarding supply and demand balances while being stressed with technology adoption acceleration and a difficult business environment.
Kearney stated in its summary, “Shippers and carriers alike are contending with a turbulent global economy that features a combination of stubborn inflation and still-spotty demand. Adding to the uncertainty is an intensification of geopolitical and climate stressors on world markets—and the logistical networks upon which those markets rely.”
The sponsors of the report include the Council of Supply Chain Management Professionals and Penske Logistics. This report has become a key indicator for anyone involved in the global supply chain.
Kearney reported, “We found technology playing an increasingly important role in logistics operations, on both the carrier and shipper sides. And we saw sustainability shifting from a peripheral concern to a core business imperative—with major innovations in electric vehicles, alternative fuels, and carbon offset programs. Looking ahead, however, the industry, while cautiously optimistic, faces some tough economic realities that will challenge the sector’s players and test their agility and resilience.”
The tariff and trade wars between the United States and other major economic regions are the big new challenge for the sector in 2025. Kearney suggested that tariffs are a “significant wildcard that threatens to both raise costs and suppress demand, thus reducing freight volumes.” Also, according to the report, a growing divide between the US and EU in regulations around sustainability is adding complexity to what is already a complicated challenge. This is especially true for sectors affected by the new deforestation and packaging requirements.
Not surprisingly, ecommerce remains a powerful force shaping automation and infrastructure investment. Analytics, IoT sensors, and AI are major technology tools and drivers as shippers, cargo carriers and truckers seek to optimize their logistics operations for efficiency, resilience, and sustainability. Kearney commented, “Companies are exploring faster deliveries, dynamic routing, and competitive service offerings to meet rising consumer expectations.” These trends are leading to greater warehouse automation and higher pallet quality standards for newer facilities.
Consumer purchasing trends are changing too, and this affects supply chains. The State of Logistics report found that a “barbell effect” is emerging. Kearney explained, “Demand is split between ultra-fast delivery for essentials and ultra-low-cost, slower shipping for non-essentials. Traditional and non-traditional carriers are battling it out, with the latter focused on providing lower-cost, slower delivery while the former are capitalizing on their strengths to defend their position.”
Looking at the future, the Kearney report predicted, “There’s a clear shift from reactive swings into proactive strategies driven by technology innovation and strategic consolidation. At the same time, maintaining adaptability amid continued trade tensions remains crucial.” These pressures will likely lead to continued pallet ordering volatility. Shippers will try to cut costs but maintain enough supply at the right time to take advantage of various shifting duty and tariff rates.
The trucking sector correlates with the pallet sector. And the trucking industry has been in a recession for a while. But the good news is that the trucking sector may slowly be getting out of the doldrums. According to the latest numbers from the U.S. Bank Freight Payment Index, the U.S. trucking industry achieved quarterly gains in shipments and spending for the first time since 2022. The shipments index increased 2.4% in the second quarter of 2025 compared to the first quarter of the year. But this result is still down 9.8% compared to the second quarter of 2024. The U.S. Bank report cautioned, “While it is too early to say the freight market has definitively turned the corner, the second quarter of 2025 was a very good step.”
Also, the latest report from ACT Research has found, “The U.S. trucking industry has moved past the bottoming phase of the truckload cycle seen in early 2023 and is now navigating a slow rebalancing process as of December 2024. Progress continues, but challenges such as high interest rates and inventory overhangs are shaping the pace of recovery.”
Some key factors to monitor for the trucking sector are sluggish freight demand, equipment production and macroeconomic shifts. ACT noted, “The U.S. economy enters late summer 2025 facing a mix of rising cost pressures and weakening growth signals. While consumers remain relatively resilient, underlying indicators point to softening momentum.”
What do all these trends mean for palletization? Pallet suppliers need to find out more about their customers’ supply chains. They need to realize how automation and even analytics are changing what matters to customers. They need to be able to talk sustainability, AI and analytics with customers.
The trucking sector appears to be slowly coming out of a freight recession. This could lead to some minimal increases in pallet demand. But don’t expect a huge resurgence without some major economic catalysts, especially in the short term.
