June freight paradox: rates surge as European cargo volumes fall 

According to the latest Ti–Upply–IRU European Road Freight Rate Benchmark, the contract rate index rose by 7.9 points quarter on quarter to 148.0, while the spot index jumped by 14.6 points to 146.8. Compared with a year earlier, the two indexes were up by 15.2 and 13.9 points respectively.

Yet road freight volumes between the major EU economies covered by the benchmark fell by 1.6% year on year. Traffic between Germany and France declined by 3.9%, while volumes on the Spain–France corridor dropped by 3.6%.

Rising rates do not point to a conventional freight recovery

The much faster rise in spot prices provides the first indication that the market was responding to immediate cost and capacity pressures rather than a sudden surge in cargo.

Contract rates are agreed over longer periods and consequently adjust more slowly. The spot market reacts much more quickly when fuel prices rise, available capacity changes or operators refuse loads at prices that no longer cover their costs. Its 14.6-point quarterly jump therefore suggests that the cost of securing transport increased abruptly during Q2.

The underlying volume figures tell a very different story. Freight movements between Germany and France declined by 3.9% year on year, while traffic between Spain and France fell by 3.6%. These are not the conditions normally associated with a demand-driven rate boom, in which shippers compete for insufficient capacity as factories and retailers send more goods onto the road. Instead, hauliers were attempting to recover rapidly rising costs while carrying fewer tonnes on several important corridors.

Diesel was the most immediate source of pressure. Its average EU price reached €1.94 per litre during the quarter, 12% more than in Q1 and 27% above its level a year earlier. Prices peaked at an average of €2.19 per litre in April before easing to €1.76 in the final week of June.

The increase affected operators’ entire cost base. According to the CNR index cited in the report, the cost of running a long-haul truck rose by almost 10% year on year. Even where demand remained weak, such an increase became increasingly difficult for carriers to absorb.

German routes reveal the scale of the divergence

The Europe-wide indexes conceal substantial differences between individual corridors, but some of the strongest increases were recorded on routes connected to Germany. Contract rates from Antwerp to Duisburg reached €3.05 per kilometre after rising by 25.1 index points year on year. Duisburg–Lille climbed to €2.58 per kilometre, up 22.2 points annually, while Duisburg–Prague reached €1.73 following a 19.7-point increase.

The Duisburg–Lille movement is particularly revealing. Overall road freight volumes between Germany and France fell by 3.9%, yet rates on the route rose sharply. Prices were therefore moving in the opposite direction to the quantity of freight carried on the wider corridor.

Domestic German figures reinforce the same conclusion. Contract rates increased by 11.6 points during the quarter to reach 158.3 in June. Spot rates rose by 10.2 points quarter on quarter and by 19.2 points annually—the strongest year-on-year spot increase among the four domestic markets covered by the report.

Such growth is difficult to attribute to the German economy alone. The Bundesbank expects GDP to expand by only 0.5% in 2026, while high energy costs and international trade risks continue to constrain industry.

There are some indications that the industrial downturn may be bottoming out. German manufacturing returned to expansion in June, industrial production rose by 0.9% in May and automotive output increased by 3.6%. This improvement may be preventing a further deterioration in freight demand, but it is not yet strong enough to explain the scale of the rate increases.

Germany consequently provides perhaps the clearest illustration of the wider European trend: the price of road transport can recover well before the economy or freight volumes do.

France shows how selected industries can support a weak market

The same tension is visible in France, where strong performance in a handful of industrial sectors has not translated into a general recovery in freight volumes. French manufacturing output increased by 2.2% year on year. Production across aerospace, rail and shipbuilding rose by 21.3%, while computer and electronics output grew by 6.1%.

These sectors generate specialised, higher-value and often internationally connected freight. Aerospace and defence exports could therefore support parts of the French transport market during the second half of the year. However, their strength has not been sufficient to reverse the decline on France’s major cross-border corridors. Alongside the 3.9% fall in Germany–France traffic, volumes between Spain and France dropped by 3.6%.

Broader economic growth also remains weak, with the Banque de France forecasting GDP expansion of only 0.5% this year. Household demand remains subdued, limiting the prospects for a consumer-led freight recovery.

Despite this, French domestic spot rates jumped by 16.6 points during the quarter to 149.5. Contract rates increased more slowly but still gained 6.9 points, reaching 132.6 in June.

Again, costs offer the stronger explanation. French diesel prices were 33.4% higher year on year in May, placing operators under significant pressure even as the amount of freight available on major international corridors declined.

Poland is the exception where demand supports higher rates

While Germany and France demonstrate how costs can push rates higher in a weak market, the Germany–Poland corridor offers a different—and more positive—picture. Road freight volumes between the two countries increased by 1.5% year on year, bucking the wider decline between Europe’s largest economies. The direction of trade also shifted: in April, Germany transported more goods to Poland than it received from the country for the first time in two years.

That development is supported by a considerably stronger economy. Polish GDP is forecast to grow by 3.6% in 2026, driven by household consumption and investment supported partly by EU funds. Poland was also among the major European markets recording the strongest growth in new truck registrations during the first half of the year, indicating greater confidence among operators.

Rates on the Warsaw–Duisburg route rose alongside this expansion in freight activity. Contract prices reached €1.45 per kilometre, up 14.9 index points year on year, while spot rates climbed to €1.51, an annual increase of 17.3 points.

Higher prices do not necessarily mean healthier hauliers

Although rising rates may appear positive for carriers, they will not automatically result in wider profit margins. If higher prices merely offset diesel, labour, financing, and vehicle costs, operators may earn little more per journey in real terms. Falling volumes can also leave vehicles idle, make balanced return loads harder to find and increase the proportion of kilometres driven empty.

That problem becomes particularly acute when trade flows are unbalanced. Even a comparatively strong headhaul rate may not make a round trip profitable if a vehicle returns empty or the operator must accept heavily discounted backhaul work.

The Q2 figures consequently describe a market in which transport prices are recovering faster than transport activity. Shippers are being asked to pay more without seeing a corresponding improvement in consumer or industrial demand, while hauliers are still struggling to protect margins.

Poland offers a glimpse of what a more conventional recovery might look like, with stronger economic growth generating additional cargo as rates rise. Germany and France, however, remain predominantly cost-driven markets.

Further rate increases expected

Market participants do not believe that the upward movement has run its course. The benchmark’s sentiment index rose by 11.4 points to a record 28.3. Although 54% of respondents expect only a slight increase in rates, the proportion predicting a substantial rise almost tripled, from 4.9% to 31.9%. Just 4.3% expect rates to fall.

Much will depend on energy markets. Diesel prices began climbing again in July amid renewed tensions in the Middle East and exceeded an EU average of €2 per litre on 22 July.

If fuel remains expensive, freight rates could continue to rise without a meaningful recovery in volumes. Germany and France have already shown how quickly prices can move ahead of the wider economy, while Poland demonstrates how the market changes when genuine demand growth joins the cost pressure.