U.S. Logistics Cost Pressures Reach Their Highest Level Since March 2022

U.S. logistics cost pressures climbed to their highest level since March 2022 in October, according to the latest Logistics Managers’ Index, adding a fresh sign that supply-chain strain has not eased even as the broader economy slows in places.

The report said Aggregate Logistics Costs rose to 257.5 on its 0 to 300 scale in October, up from 246.1 in September. That measure combines inventory costs, warehousing prices and transportation prices, so the move means cost pressure was broad rather than confined to one part of the freight system.

The overall Logistics Managers’ Index also remained elevated at 70.7, up slightly from 70.2 a month earlier and marking the second-highest overall reading since March 2022. Readings above 50 indicate expansion, and the October figure showed that logistics activity continued to grow at a strong pace heading into the year-end shipping season.

October’s cost data stood out because all three major price components remained hot. Inventory Costs rose to 88.8, Warehousing Prices accelerated to 80.7, and Transportation Prices stayed very high at 88.0 even after easing from September’s 92.7. In practical terms, companies were still paying more to hold goods, store them and move them.

October reading points to the strongest cost pressure in more than four years

The October Logistics Managers’ Index report described the 257.5 aggregate cost reading as the highest for that measure since March 2022, when supply-driven inflation surged after the reopening period and the shock from Russia’s invasion of Ukraine. September had already produced the highest aggregate cost reading since April 2022, so October extended that acceleration rather than reversing it.

The report also noted that this year’s logistics environment looks materially tighter than the same month a year earlier. Aggregate Logistics Costs were 202.6 in October 2025, far below this October’s 257.5. Inventory Costs rose from 73.2 a year earlier to 88.8 this October. Warehousing Prices increased from 67.7 to 80.7, and Transportation Prices climbed from 61.7 to 88.0. Those comparisons suggest that the latest pressure is not just a monthly spike but part of a stronger upswing during 2026.

That strength has shown up in the broader index too. The overall LMI has now topped 70 in three of the last five months, something the report said had not happened in more than four years. The average overall reading for 2026 has reached 67.4, well above 2025’s 58.7 and second only to 2021 in the 10-year history of the index.

Inventory rebuilding and tight capacity are pushing up costs

The October survey points to a familiar supply-chain dynamic: rising inventories are meeting constrained capacity. Inventory Levels increased to 66.9 from 58.9 in September, showing that firms were building stock faster. The report said downstream retailers were adding inventory slightly faster than upstream firms, a pattern that fits with companies preparing for holiday demand after keeping inventories relatively lean through much of the year.

That inventory rebuilding is expensive when storage space and transportation networks are tight. Warehousing Capacity stayed in contraction territory at 43.5, while Transportation Capacity came in at 38.0. Because readings below 50 signal contraction, those figures imply that available logistics capacity remained limited even as more goods flowed into the system.

Warehousing Utilization and Transportation Utilization also stayed expansionary, reinforcing the idea that existing space and freight networks are being worked hard. Transportation Prices did cool modestly from September, but an 88.0 reading is still unusually elevated on a 0 to 100 diffusion scale. Warehousing Prices moved the other way, jumping 7.2 points from September to 80.7, which was one of the clearest contributors to the stronger aggregate cost reading.

The report’s commentary said many firms had avoided holding excess stock for most of the year because tariffs and other disruptions made inventories costly. That changed as companies moved deeper into the fourth quarter. If firms decide they need more goods on hand for resilience or holiday sales, the cost of that decision is now much steeper than it was a year ago.

What the data may mean for inflation and supply-chain planning

The Logistics Managers’ Index is not a direct measure of consumer inflation, but it is a useful early read on whether supply-chain pressures are building or easing. When inventory, warehousing and transportation costs all rise together, those higher expenses can squeeze margins and, in some cases, filter through to the prices that businesses charge customers. The October report itself said the latest reading may foreshadow continued supply-driven inflation if the trend persists.

That does not mean a one-month spike automatically turns into a new inflation wave. Businesses can absorb part of the increase, transportation rates can retreat quickly if capacity improves, and consumer demand can soften. Still, the direction of travel in recent months is difficult to ignore. Aggregate Logistics Costs have moved from 217.4 in July to 243.6 in August, 246.1 in September and 257.5 in October, showing a steady build rather than a one-off burst.

For shippers, retailers and manufacturers, the report suggests that year-end planning remains unusually difficult. Carrying more inventory can reduce the risk of stockouts, but it now comes with significantly higher holding and storage costs. Waiting too long can expose firms to capacity bottlenecks and higher freight rates. The survey’s forward-looking gauge remained high as well, with respondents expecting the overall index to run at 69.1 over the next 12 months, a sign that supply-chain managers do not expect a quick return to calmer conditions.

For policymakers and investors, the main takeaway is narrower but still important. Goods-sector inflation pressure does not appear to have vanished from the logistics side of the economy. The next monthly LMI release will show whether October was the start of another leg higher in supply-chain costs or simply a very strong seasonal reading.