Q3'25 Warehouse Pricing Index Report

Executive Summary

• The National Warehouse Pricing Index rose in June, marking the 4th consecutive month of pricing inceases.
• New tariffs on imports from the European Union (EU) and Mexico are expected to go into effect on August 1st. The pharmaceutical, automotive, and machinery sectors will be most impacted.
• The U.S. national industrial vacancy rate increases to 7.1 percent, setting a record this decade for available industrial real estate space.
• The manufacturing PMI for purchased goods reaches 53.1 in June, indicating shippers are front loading inventories prior to August tarrifs.

The Warehouse Pricing Index (WPI) is available in the Journal of Commerce’s extensive, multi-channel dashboard, Gateway. Learn more about Gateway and how WarehouseQuote helps logistics managers make informed supply chain decisions.

2025 Retail Peak Season is Here

Summer promotions from Amazon, Target, and Walmart have concluded, offering a preview to the 2025 peak season. These mid-year sales allow retailers and brands to stress-test their supply chains and marketing campaigns in anticipation of the crucial holiday shopping period. 

With Amazon’s 2025 Prime Day event wrapping up a few weeks ago, we’ve officially entered the 2025 retail peak season. The event generated a record $24+ billion dollars in online sales, resulting in a 30 percent increase year-over-year. The event also saw a significant rise in ‘buy now, pay later’ (BNPL) orders.

This year’s peak season presents its own unique set of challenges: the convergence of mid-year promotions and the impending August tariffs. This has led to many brands front-loading inventory significantly earlier than the traditional Black Friday/Cyber Monday window. 

This accelerated timeline is already evident at the Port of Los Angeles with imports expected to hit 950,000 twenty-foot equivalent units (TEUs), a 11.5 percent increase month-over-month. 

Experts say it’s likely that we see a double digit drop off in import volume from August through November as retailers have pulled cargo forward to cover several months of sales.

Beyond inventory, a comprehensive supply chain approach is required to navigate these shifting retail seasons. Here’s are a few practical peak season tips for shippers:

• Prioritize System Integration: Unifying inventory and order management across your sales channels is no longer a nice to have. It’s a must for fast-growing brands.
• Fostering Strong Communication and Proactiveness with Your Supply Chain Partners: Conduct thorough inventory audits, diversify shipping carriers, optimize warehouse operations, proactively communicate sales forecasts with your warehouse partners to effectively plan labor resources to meet increases in order volumes.
• Drive Alignment Between Marketing & Operations Teams: It’s critical for marketing and operations teams to be aligned on campaign & promotion schedules to ensure an optimal brand experience for your customers.
• Elevating Customer Experience: Increase staffing for customer service, ensure a seamless online and mobile shopping experience, and maintain transparency regarding shipping times and potential delays to build trust.

The 2025 peak season demands an extended marathon, not a sprint. Brands that began preparations in late Q1 and Q2 are best positioned for success. Flexibility, data-driven strategies, and a customer-centric focus will define this year's retail winners.

U.S. Warehouse Market Watch

• 7.1% National Industrial Vacancy Rate
• 112.1 National Warehouse Pricing Index Reading (+0.1 BPS MOM)

It’s important to note that the elevated national industrial real estate vacancy rate is mostly due to supply and demand gaps in tier 1 & 2 markets. The majority of vacancy rates in tier 3 and 4 markets are considerably lower than the national average.

The National Warehouse Pricing Index (WPI) increased 0.1 percent month-over-month (MOM), marking the 4th straight month of pricing increases. The combination of shippers front loading inventory before August tariffs & increasing labor costs are the likely factors contributing to elevated prices.

The Midwest and Northeast regions have seen an increase in warehouse services pricing at 2.3 and 1.4 percent year-over-year. The West and South both saw pricing decreases at 1.5 percent, respectively.

The Three Stages of Tariffs: Mitigation Strategies Move from Front Loading to Pricing

Rapidly shifting US tariff policies have been the defining driver of supply chain decision-making so far in 2025, and there’s little near-term sign of a complete resolution of the uncertainties. This leaves firms stuck in “tactical mode” for now, even though many of our industry contacts are keen to return to long-term decision-making.

The road ahead appears deceptively simple. The US administration has set August 1 as the date for the implementation of wide-ranging IEEPA (International Emergency Economic Powers Act) tariffs on individual countries and a series of product-level duties under the Section 232 program will be rolled out during the remainder of 2025. However, the timings and levels of all the tariffs remain in flux, and President Trump has shown a willingness to use ad-hoc tariffs as part of his wider policy aims.

We’ve identified three stages of actions that firms are taking to deal with the ongoing tariff uncertainties. 

The first stage was the early building of inventories. US manufacturers have added stocks of purchases at a rapid rate, shown by the US manufacturing PMI for purchased goods reaching 53.1 in June. However, the changes in inventories further downstream in supply chains including retail are relatively modest given the high financing costs involved.

The inventory building stage appears to be near an end. US seaborne imports of containerized freight dipped 0.8% lower year over year in June, following a 4.9% drop in May and leaving the total for the second quarter just 1.4% higher than a year earlier. The seasonal consumer durables sector experienced an 8.3% decline in June versus a year earlier. While consumer electronics and leisure goods improved by 22.9% in June versus May, they were only 4.4% above April’s level compared with a 10-year average of 21.9%, illustrating the degree of seasonal distortion that has already occurred. 

The second stage, which is now underway, involves a mixture of raising prices for consumers and negotiating lower prices with suppliers. The latter is already bearing fruit, with lower import prices already being reported, particularly for shipments from mainland China.

Market Intelligence estimates indicate import prices will fall by 3.3% by the end of 2026 versus the first quarter of 2025. The reduced prices take time to work through into imports as many procurement contracts are set 12 to 18 months ahead. Firms are increasingly treating tariffs as a separate line item in negotiations, rather as is the case for logistics or fuel costs historically. 

The implementation of higher prices for consumers has been slow in arriving, partly due to firms working through “pre-“ or “low-tariff” inventory while the ongoing picture becomes clearer: most firms prefer not to move prices, particularly at the retail level, more than once or twice per year.

Evidence from our review of machine-readable corporate earnings transcripts indicates price rises in many consumer goods in the order of 10%, but deployed tactically where the demand effect will be low. As a result, S&P Global Market Intelligence forecasts expect US consumer durable goods prices to rise 4.5% in the fourth quarter of 2025 versus the first quarter.

The third stage is long-term investment in adapting sourcing patterns for the new tariff reality. Tactical shifts in procurement, moving higher tariff countries temporarily out of the supply network, have largely been exhausted. Decisions on where to site sourcing and new manufacturing capacity to serve the US can take years to implement and have been delayed this year. Looking into 2026, uncertainties over the future of the USMCA free trade regulations may provide another hurdle.

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The Freight Market in Flux: Recent Trends and the Warehouse Ripple Effect

As summer 2025 is in full swing, the North American freight market stands at a familiar crossroads—caught between seasonal shifts, structural overcapacity, and ongoing policy turbulence. While no single factor dominates the market, the interplay between domestic truckload activity and evolving trade policies is shaping not just the near future of freight movement but also inventory and warehouse strategy.

Truckload Stability, but Not Yet Strength

Despite some seasonal pressures, such as DOT road check week and produce season, towards the end of Q2, the U.S. truckload market remains soft overall. Spot rates have modestly stabilized compared to earlier in the year but remain below long-term averages. Capacity is still ample, largely due to the persistence of an oversupplied carrier market. Yet, we're beginning to see subtle signals that a rebalancing may be underway; this is evident by the slowing number of carrier exits and tightening equipment availability in certain regional markets, especially in the reefer segment.

Freight volumes have been spotty, due to varying shipper strategies around import activity and inventory-to-sales ratios. Produce season surges added to this volatility but is expected to temper as the weather cools and less harvesting is needed. This patchy demand means shippers must remain agile with their routing and mode choices, paying attention to broader market trends beyond just their own internal freight needs.

LTL Conditions Hold Steady, But Pressure Builds

In the LTL sector, conditions have been more stable, though not without strain. Capacity has been limited since the exit of Yellow from the market two years ago but due to the decreased tonnage, service levels have been generally reliable. Pricing has steadily increased in these past two years as well but with stronger competition from smaller regional carriers, some of the old Yellow terminals coming back online, and stubbornly soft demand outlooks, there are some questions as to what the next few quarters will look like.

Network optimization efforts are ongoing across the LTL space, especially among carriers trying to reduce cross-dock handling and consolidate underutilized terminal operations. At the same time, the National Motor Freight Traffic Association (NMFTA) just implemented their new changes for National Motor Freight Classification (NMFC) codes. This change went into effect as of July 19, but shortly thereafter, the largest LTL carrier announced that they would delay enforcement of these changes to help shippers adapt to these new classes.

Trade Policy and Customs: The Wild Card

Looking at trade policy, increased tariff volatility and uncertainty have resulted in several downstream issues. Eating tariff costs, passing along costs to consumers, re-sourcing international partners, researching reshoring activities, potential inflation, shifting consumer demand, changing freight lanes and modes, altering inventory strategies, are amongst some of the top issues that have persisted and will be top of mind in the third quarter.

Warehousing: Navigating the Freight Drag and the Inventory Shifts

For those managing inventory and warehouse strategies, these freight dynamics translate into a unique set of challenges.

First, the sluggish truckload market and steady LTL service performance allow for more efficiency in a just-in-time strategy. Shippers trying to decrease their inventory-to-sales ratio are able to utilize the strong capacity and service in combination with low truckload rates to achieve this.

On the flip side, import volume surges that have occurred due to pull-forward ahead of tariffs have resulted in increasingly unpredictable receiving schedules and congested ports, which strains labor planning and warehouse space allocation.

Warehouses near ports and major inland distribution hubs (like Los Angeles, Chicago, Dallas, and Atlanta) have reported tighter capacity utilization as importers have rushed to bring in goods ahead of potential new tariffs or policy shifts. This “just-in-case” inventory strategy, which gained momentum earlier in 2025, is leading to higher short-term leasing activity for flexible storage.

The bifurcation in strategy exists not just from shipper-to-shipper, but also from product-to-product and time-to-time within a shipper’s own business. This makes planning even more specialized and trends more specific to the use-case.

Final Thoughts

Looking forward, if truckload rates rise and LTL shipping struggles through the early stages of the classification changes, warehouse capacity could tighten as the strain in supply chains trickles out. The current freight landscape may not be booming, but it is on the precipice of shifting and warehousing is not exempt from the impact. Those managing inventory and warehouse strategy should stay closely attuned to transportation market signals, particularly in truckload spot rate patterns in addition to the evolving tariff and macroeconomic landscape to be better positioned to flex tactics in real time if necessary. 

For more information on the state of the freight market, check out C.H. Robinson’s North American Freight Market Insights Report.

Explanation of Terms

Industrial Real Estate Vacancy Rates

Industrial real estate vacancy rate is the percentage of available industrial property, such as a warehouse or distribution center.

United States Regional Divisions

Midwest‍

• East North Central: Illinois, Indiana, Michigan, Ohio, and Wisconsin
• West North Central: Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, and South Dakota

Northeast

• New England: Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont
• Middle Atlantic: New Jersey, New York, Pennsylvania

South ‍

• South Atlantic: Delaware, Florida, Georgia, Maryland, North Carolina, South Carolina, Virginia, Washington DC, and West Virginia
• East South Central: Alabama, Kentucky, Mississippi, and Tennessee
• West South Central: Arkansas, Louisiana, Oklahoma, and Texas

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The material and content used in this publication is for informational purposes only. Reference to any third party (including external hyperlinks) does not constitute or imply the endorsement of said third party. WarehouseQuote does not warrant the accuracy or completeness of the Content. The views and opinions expressed herein are those of the author and do not necessarily reflect the official policy or position of WarehouseQuote. Reproduction of the Content may be made only with the written permission from WarehouseQuote.

Sources

• United States Federal Reserve
• United States Census Bureau
• C.H. Robinson North American Freight Market Insights
• S&P Global Market Intelligence
• Cushman & Wakefield