The Two Materials That Predict Freight Demand Both Just Posted Gains. Here Is What February’s Data Is Telling Us.

The Two Materials That Predict Freight Demand Both Just Posted Gains. Here Is What February’s Data Is Telling Us.
Adam Wingfield
11 min read
Most truckers track spot rates. Some track load-to-truck ratios. A smaller number pull freight data every week. Not many are watching the pallet Producer Price Index or the American Forest & Paper Association’s monthly packaging report — which is exactly why understanding those two numbers right now puts you ahead of most of the market.
This article breaks down what those two data sets are saying, what they mean in plain terms for your operation, and what the next 90 days could look like if the signal holds.
The Simple Idea Behind the Data
Think about the last load you hauled that had anything to do with retail or consumer goods — a run to a DC, a warehouse pickup, a manufacturing plant. Whatever was on that trailer was sitting on a wooden pallet. And before it got to you, it was sitting inside a corrugated box made from packaging paper that came from a paper mill weeks earlier.
That sequence — mill to converter to manufacturer to truck — is the point. The materials that become the boxes and pallets your freight rides on get made and shipped before the freight itself ever moves. Which means the people buying those materials right now are telling you, in advance, how much freight is coming. They just do not speak trucker.
Two data sources track those materials: the AF&PA packaging papers monthly report, and the pallet Producer Price Index tracked by the Bureau of Labor Statistics. Neither will ever show up on a load board. Both of them are worth understanding.
What Pallets Have to Do With Your Loads
Every load of goods that moves through the U.S. freight system — retail, manufacturing, e-commerce, food and beverage, you name it — sits on a wooden pallet. When businesses are shipping a lot of goods, they go through a lot of pallets. When they are not shipping much, pallet demand drops off and pallet prices fall.
The Bureau of Labor Statistics tracks pallet prices through what is called the Producer Price Index, or PPI. The FRED chart below in this article shows that index going all the way back to 1975. What it shows is one of the cleanest pictures of the freight cycle you will find anywhere in government data.
Here is the story the chart tells in plain English. For decades — from the late 1980s all the way to 2020 — pallet prices climbed steadily, reflecting slow and consistent growth in goods movement year over year. The index started at roughly 80 back in the 1970s and gradually worked its way up to around 200 by 2021. That steady climb is 45 years of the U.S. economy shipping more stuff over time.
Then 2020 hit and the chart went nearly vertical.
The pandemic sent consumers home with stimulus money and nowhere to spend it on services, so they bought things — appliances, furniture, home improvement supplies, electronics, everything. E-commerce exploded. Supply chains backed up. And pallet prices went from around 200 to a peak of approximately 440 by mid-2022. That is more than double in two years. The BLS confirmed the pallet PPI rose 60% in just the first two years of that run.
If you were running freight in 2021, you remember what that felt like. Rates were as high as they have ever been. Loads were everywhere. It was the best freight market most people in this industry had ever seen. The pallet index was tracking every bit of that.
Then it came down. Hard. The freight recession that started in late 2022 and ran through most of 2025 — the one that put tens of thousands of small carriers out of business — showed up in the pallet index just as clearly. The index fell from 440 back down toward 325 as goods movement dried up and rates collapsed.
Pallet prices and freight volumes moved up together and came down together. They are measuring the same thing from a different angle.
Which brings us to right now.
Where the Pallet Index Stands Today — and Why It Matters
As of the most recent data from FRED, the pallet PPI has stabilized after its steep post-pandemic decline. It is not surging. It is not heading back to 440. But it has stopped falling, and industry analysts tracking seven separate leading indicators tied to the pallet market characterized the current setup as the first time all seven indicators have pointed in a positive direction simultaneously since 2022.
That matters because it is not just one number moving. It is a cluster of signals — consumer spending trends, retail sales, manufacturing inventory levels, and others — all pointing the same direction at the same time. When that happens in a market that has been in contraction for three years, it is worth paying attention to.
There is also a newer force working in the pallet market’s favor that did not exist a year ago. The federal government eliminated what was called the de minimis exemption for low-value packages from overseas e-commerce platforms in August 2025. What that means practically: cheap packages from platforms like Temu and Shein that used to ship directly to U.S. consumers as small individual parcels now have to move through the normal import system — which means containers, which means pallets, which means more demand for the same wooden platforms that have been tracking freight volume for 50 years. That is a structural shift that adds to pallet demand on an ongoing basis, not a one-time event.
What the Packaging Paper Data Says
The American Forest & Paper Association released its February 2026 Packaging Papers Monthly Report on March 19. Here are the numbers that matter.
Total packaging papers and specialty packaging shipments were up 4% compared to February 2025. The unbleached packaging papers operating rate — which measures how much of available mill production capacity is actually running — came in at 83.9%. That is up 4 full percentage points from February 2025.
Here is the plain-English translation of that operating rate number. Paper mills do not run at nearly 84% capacity when business is slow. They run at 84% when the companies downstream of them — the businesses that turn packaging paper into corrugated boxes — are ordering material because they have production to fill. And those box manufacturers are filling orders because the companies buying the boxes — manufacturers, retailers, e-commerce fulfillment centers — expect to be shipping goods. An 84% operating rate at the mill level is a signal that the goods supply chain is active several steps before a load ever hits a board.
The one number in the report that adds caution is a 7% year-over-year increase in total inventories. More on that in the Q&A. The short version: it could mean stockpiling ahead of expected demand, or it could mean production is getting ahead of actual orders. The next two months of data will tell us which.
One category moved the wrong direction: bleached food wrapping shipments were down 1.5% from last February. This is the paper that goes into fast-food and food service packaging. Its decline reflects what a lot of people already feel — consumers are spending less on eating out, and that is showing up in the packaging that supplies those restaurants.
When Two Signals Line Up
On their own, either data set — the pallet index or the packaging paper numbers — is interesting. Together they are more meaningful, because they are measuring the same underlying activity from different points in the chain.
Packaging paper is ordered months before a finished good ships. It is at the very beginning of the process — mill to converter to box maker to brand to shipper to truck. Pallets sit at the other end of the pre-shipment process — they are what the finished goods get stacked on right before they are loaded onto a truck. When both materials are showing positive movement at the same time, it means the goods economy is firming across multiple stages of the supply chain simultaneously, not just flickering positive at one point.
That is what is happening right now for the first time since before the freight recession. Packaging paper shipments are up with mills running at their best capacity utilization in two years. Pallet market indicators are all pointing constructive for the first time since 2022. The two signals are telling the same story from different directions, and that story is that goods movement is beginning to pick up.
For context on what that has historically meant: the pallet PPI peaked at 440 right at the height of the 2021-2022 freight boom. It bottomed out during the Great Freight Recession. When that index has historically turned from declining to stabilizing to firming, freight volumes have followed within one to two quarters. The current reading suggests that turn is underway — not at boom intensity, but in the right direction for the first time in three years.
What This Means for the Next 90 Days
Here is a plain-language read of what the combined data suggests for Q2 and Q3.
April through June is the best window. Produce season starts in April and runs hard through June, pulling reefer capacity tight first. When reefer tightens, it pulls dry van with it — shippers who normally move temperature-controlled goods start competing for any available truck. Add the improving packaging and pallet signals on top of that seasonal pressure and you have the conditions for the best freight environment small carriers have seen in three years. Not the crazy rates of 2021 — but genuinely tighter than anything that has existed since the recession started. The carriers with relationships already in place with industrial shippers near packaging facilities will be in the best position. The carriers still chasing the board will still find more loads, but they will be competing harder for them.
July through September depends on follow-through. The key thing to watch is whether the inventory build at the mill level works off through Q2. If box manufacturers pull that inventory into production — meaning actual orders are coming in and goods are moving — then Q3 looks solid. If the inventory keeps building and mills slow down to rebalance, the early signal fades. Watch the April and May AF&PA releases. They will tell you whether February was a real demand turn or a head fake.
The wildcards are diesel and tariffs. Diesel above $5 is squeezing spot market margins right now, but it is also accelerating carrier exits — which tightens supply and eventually supports rates for the carriers who stay in. Tariff policy is harder to forecast. If escalation hits the consumer goods categories that generate box demand — electronics, appliances, home goods — it compresses the improvement the leading indicators are pointing toward. If tariffs stabilize or ease, the goods economy is more likely to deliver on what the packaging and pallet data is currently suggesting.
What to Do With This Information
If you are running a single truck, this data is your permission to get more aggressive in your negotiations with brokers right now. The supply chain is telling you that more freight is coming. The broker calling you does not necessarily know that. You do. Use it.
If you are running a small fleet, this is the data that tells you which customers are worth developing relationships with before the market fully turns. Corrugated box manufacturers, packaging distributors, the manufacturers and retailers who buy from them — these are the shippers whose freight picks up first when the goods economy turns, because they are connected directly to the materials that are already moving. Get in front of them before the load board reflects what the mill data already shows.
If you are a fleet executive managing a larger operation, this is the forward signal your procurement and capacity planning teams should be tracking alongside spot rate data. The lag between the packaging and pallet indicators and freight rate movement has historically been one to two quarters. If the signal holds through April and May, you are looking at a meaningfully tighter market in Q3 that the current contract rate environment does not yet fully reflect.
The data is available, it is free, and it is updated monthly. Most of your competition is not looking at it. That gap is the advantage.