FARGO, N.D., Oct. 20, 2025 — At Border States, keeping you informed about the state of our supply chain remains a top priority. Across the core markets we serve (construction, industrial and utility), our industry continues to see a mix of resiliency and stabilization, coupled with persistent headwinds. As always, we aim to provide timely insights to help you plan your business with confidence. While accurate to the best of our knowledge, the information in this letter reflects current conditions and may evolve rapidly.
October began with a federal government shutdown that has now extended into its third week, further stressing economic uncertainty in our country. At Border States, our customers continue to respond to rising energy demands, digitalization and labor pressures, and infrastructure modernization needs. From AI-driven data center expansion and investment in automated manufacturing to electrification, these forces are reshaping the demand and requirements of the global supply chain.
Lead Time Trends
Government shutdown poses a risk to the economy
The U.S. government shutdown, which began on October 1, is now in its third week due to a stalemate over healthcare and spending for the fiscal year. The shutdown is causing widespread disruptions, from staff furloughs to flight delays.
Why it matters: The shutdown not only affects immediate federal operations and services but also poses risks to the economy the longer the shutdown continues, potentially influencing the Federal Reserve’s (Fed) monetary policy decisions.
- Economists estimate job gains in September are weaker than August figures, while the actual data has not been released yet.
- Alternate sources estimate the unemployment rate is estimated to hold steady at 4.3%. And the labor force participation rate is estimated to hold steady at 62.3%.
- The Fed cut interest rates by a quarter point in September. Fed Chair Jerome Powell signaled a likely quarter-point cut this month, as Fed members are looking at alternative data sources amid the government shutdown’s impact on economic indicators.
The Bureau of Labor Statistics released a significant revision to the U.S. jobs data last month. The report shows 911,000 fewer jobs were added from early 2024 to March 2025, weaker than initially reported, particularly in the manufacturing and construction sectors.
Why it matters: This downward revision, one of the largest in recent history, also suggests the labor market’s recovery has been less robust than previously believed, potentially impacting economic forecasts and Fed policy.
By the numbers: The revision lowers the average monthly job gains to approximately 71,000 from 147,000 — a sharp contrast with the previous estimated 1.76 million jobs added during that period.
Ocean freight rates continue to fall amid soft demand
Ocean shipping rates have fallen across major freight lanes due to tariffs, overcapacity and soft demand.
By the numbers: September import volumes dropped 8% from August and 8% year-over-year, with imports from China down 12% month-over-month and 23% last year as importers shift volumes to other countries.
The big picture: Carriers are canceling sailings to stabilize rates, reducing service reliability. Meanwhile, the first phase of a peace deal between Israel and Hamas raises hopes for recovery in the Suez Canal. Still, security risks from Houthi rebel attacks continue to pose threats to Red Sea shipping, experts say, and recovery won’t happen immediately.
New tariffs and rules reshape the trucking market
The U.S. trucking industry continues to struggle with weak demand and historically low spot rates, generally favoring shippers.
Why it matters: Incoming tariffs on heavy-duty truck imports and new rules, including the Federal Motor Carrier Safety Administration restricting non-domiciled Commercial Driver’s Licenses, are reshaping the market. Many shippers have front-loaded imports to avoid tariff impacts, which is impacting Q4 volumes.
The big picture: While flatbed segments are showing some capacity tightening, the overall market recovery remains uncertain. New truck orders are down 20% year over year, signaling caution among carriers. Market softness is expected to persist into early 2026 with no clear path to recovery.
Ceasefire plan eases commodity market pressure
Commodity markets, from copper to crude oil, are under pressure from various factors, including geopolitical tensions, supply chain disruptions and trade policy changes. A breakthrough in the Middle East eased some uncertainty, when Israel and Hamas agreed to the first phase of a ceasefire plan.
By the numbers: Copper prices are expected to rise more than 12% in the next two years due to supply constraints and robust demand from clean energy and AI sectors. The domestic aluminum and steel industries are affected by trade policies and demand shifts, including a 4.4% drop in aluminum demand in the United States and Canada, and a 16.8% drop in U.S. steel imports. Lumber futures fell to nearly $525 per thousand board feet. Brent Crude futures fell 0.8% while West Texas Intermediate fell 0.7% on October 15.
The bottom line: Commodity markets remain in flux as supply disruptions, trade policies and shifting demand continue to drive short-term price swings.
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