breaking

Parcel Shipping Costs Hit Record Territory as Fuel Surcharges Spike

Express parcel rates climbed 5.9% sequentially in the second quarter and are projected to surge 11% year over year, driven by elevated fuel surcharges and higher billed weights, according to the TD Cowen/AFS Freight Index released Tuesday. The index is expected to reach a record 15.8% above 2018 baseline levels in the third quarter. Ground parcel rates are forecast to increase 5.2% year over year. Fuel surcharges jumped 65.4% year over year in the second quarter, with net surcharges per package rising 40%. Major carriers FedEx and UPS have restructured surcharge formulas to maintain revenue streams even as diesel prices decline. Escalating geopolitical tensions pushed diesel prices up 22 cents Monday to $4.79 per gallon after weeks of decline.