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US business logistics costs soared in 2022, report finds

By July 6, 2023No Comments

In 2022, U.S. business logistics costs, or what is spent to keep the nation’s logistics network humming, grew by an astounding 19.6% to a record $2.3 trillion, representing 9.1% of national gross domestic product, according to the 34th annual State of Logistics Report.

On a percentage basis, financial cost of inventory led the way with a 90.2% increase, fueled by the Federal Reserve’s aggressive interest rate increases. From the standpoint of modes,  truckload costs rose 6.2% to $403.8 billion. Less-than-truckload costs rose 6.4% to $96.3 billion, while private or dedicated costs rose 6% to $95.8 billion.

Parcel costs rose to $217 billion, a 4.7% increase. Rail costs rose 17.6% to $99.2 billion. Maritime — which includes domestic U.S. — rose 18.4% to $36.4 billion, while airfreight rose 1.7% to $66.8 billion.

Coming off this performance, supply chain demand is likely to remain stagnant or diminish for the remainder of 2023. Still, any downturn in the U.S. economy is likely to be mild and short lived, the report, unveiled in Indianapolis Tuesday, said.