Subscribe to our free, weekly email newsletter!


FTR reports Shipping Conditions Index may head down in coming months

By Jeff Berman, Group News Editor
September 24, 2012

Business conditions for shippers appear to be on the precipice of a downward slope, according to the monthly Shippers Conditions Index from freight transportation consultancy FTR Associates.

The SCI for July, the most recent month for which data is available, was -4.5, which was steeper than June’s -1.8. A reading above 0 suggests a favorable shipping environment, and FTR describes the SCI as an indicator that sums up all market influences that affect shippers, with a reading above zero being favorable and a reading below zero being unfavorable. May 2011’s -11.4 was the worst SCI reading of this current economic cycle.

FTR said that this current period commences what it labels as an “inflection point” in which costs and rates head up of the U.S. economy is able to sustain a mostly healthy freight market as new regulations go into effect.

The firm added that the forecasted tightening of capacity and associated rise in shipping costs will continue to have a negative impact on the SCI unless the economy’s recovery is sharper than expected. 

In an interview with LM, FTR Senior Consultant Larry Gross noted that in previous months, conditions had been better for carriers than shippers although now the pendulum seems to be shifting away in making things more complicated for shippers barring further delays in Federal Motor Carrier Safety Administration regulations like CSA, HOS, and EOBR or a further decline in economic conditions.

“Carriers are finding that the past few months have been a little more difficult while there seems to be an adequate supply of truck capacity out there to meet demand at the moment,” he said. “That is why the SCI is not going up at the moment—or getting any worse.”

What’s more, the demand environment at the moment is “sensitive” because the economy is in a soft patch, Gross observes.

About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Read how others are using Business Process Modeling to implement Microsoft Dynamics AX with reduced risk.

While diesel prices have largely been out of the spotlight in 2014, freight transportation and logistics stakeholders always need to keep a close eye on what prices are doing, as it has a significant impact on transportation budgets and forecasting.

Railroad service issues and rates, which many rail shippers deem as unreasonable, are front and center in a piece of legislation to be introduced soon by Senators Jay Rockefeller (D-WV) and John Thune (R-SD), chairman and ranking member of the Senate Committee on Commerce Science and Transportation.

The Nicaragua Canal will be three times the length of the Panama Canal, crossing the major Lago de Nicaragua, one of the largest freshwater reservoirs in the region.

FTR and Internet Truckstop said that this alliance will provide shippers and carriers with myriad benefits, including market analysis and specificity for contract and spot freight segments by region and trailer type.

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA