Spot rates for road transportation in Europe became lower than contract rates

According to the report for the second quarter of 2023 published on the International Road Transport Union (IRU) website, the road freight rate index for Europe decreased by 0.2 points quarter-on-quarter. The spot rate index decreased by 3.5 points quarter-on-quarter. The conclusions are based on data collection from three companies: Upply, Transport Intelligence (TI), and IRU.

The experts are witnessing the first drop in spot rates lower than contract rates for the first time in the last 6 years. Looking at the figures on an annual basis, the situation is the following: the index of spot rates decreased by 7.5 points, while the index of contract rates is 2.8 points higher.

As the data shows, there is a decline in short-term demand for transportation which is followed by a decline in demand for the distribution of goods across Europe. This situation eventually results in a further drop in freight rates on the spot market.

That said, road freight prices in Europe remain on average 12–15% higher than prior to the pandemic, according to Thomas Larrier, CEO of Upply.