Demand for trucks for everything from food to furniture in the US has unexpectedly fallen sharply since early March, while prices in the on-demand freight market are falling, according to FreightWaves, a transport data company.

Craig Fuller, chief executive of FreightWaves, worries that the US is at the beginning of a trucking recession, which could weaken the ability of truckers to dominate transport prices and force some small trucking companies to go bankrupt.

At the same time, investors and financial analysts are more worried about what will happen if the decline in trucking intensifies and spreads.

History has proved that trucking may be an important indicator of the American economy. The decline in trucking means a decline in consumer purchasing power, reduced corporate shipments and a slowdown in business activity.Of the 12 trucking recessions since 1972, six have followed, according to Convoy, a truck data firm.

Experts had previously predicted that as US epidemic prevention restrictions were relaxed or even lifted, consumers would shift some of their spending from goods to services, and the trucking industry would slow slightly. However, they did not expect that the outbreak of the conflict between Russia and Ukraine pushed fuel prices to record highs and stubbornly high inflation forced consumers to shop less.

In addition, the on-demand freight market, which is most sensitive to demand, is in the process of adjustment, with fuel prices almost doubling and the decline in spot freight rates hitting truck drivers' real income. The average spot rate excluding fuel costs fell 55 cents in the first quarter, from $2.78 in mid-January to $2.23 on April 14, according to the data. Dean Croke, a freight market analyst at DAT freight & Analytics, points out that based on past trends, the decline should have been about 22 cents.

While spot rates are still 37 cents per mile higher than during the last freight bull market in April 2018, spot rates fell 6 cents from a year earlier this month, marking the first such reversal in the current cycle.

During the outbreak, as consumer spending on durable goods soared by about 20 per cent, the share of the US on-demand freight market in the transport industry roughly doubled because retailers and other shippers who focused more on speed rather than efficiency used more trucks to deliver goods faster.

By March, however, demand had fallen sharply, with US retail sales excluding gasoline sales down 0.3 per cent month-on-month, while online sales, which surged during the outbreak, fell for the second month in a row.

Analysts say soaring diesel prices have prompted freight companies to wait for trucks to fill up before they start shipping, which is a drag on freight speed and further dampens demand.

The decline in trucking is a major blow to small transport companies, but for similar companies$JB Hunt Transportation Service (JBHT.US) $、$Knight-Swift Transportation (KNX.US) $For such large trucking companies, because they have something to do with$Walmart Inc (WMT.US) $、$The Home Depot Inc (HD.US) $And$Procter & Gamble Co (PG.US) $And other companies have signed one-year fixed price contracts, and the decline in the market price of on-demand freight has less impact on them.

Trucking demand is expected to be weak in the second and third quarters, but will rebound in the fourth quarter, driven by the holiday shopping season, Stifel transport analyst Bert Subin said in a research note.

At the same time, for retailers, the decline in trucking prices is not a bad thing, because it reduces the cost burden of retailers. Cowen transport analysts said in a recent report that some shippers asked to shorten freight contracts "because they think freight rates are likely to fall. "