FTR reports Shipping Conditions Index may head down in coming months

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.

By ·

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, 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. Contact Jeff Berman

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!

Latest Whitepaper
Identify Cost Savings with Real-Time Visibility
To offset the impact of late shipments, unreported delays and detention, shippers are increasingly requiring 100 percent visibility into the location and status of their freight.
Download Today!
From the August 2017 Logistics Management Magazine Issue
Which carriers, third-party logistics providers, and North American ports have crossed the service excellence finish line ahead of their competitors? Our readers have cast their votes, and now it’s time to introduce this year’s winners of the coveted Quest for Quality Awards.
BMW Takes the Inland Road to Efficiency
Global Logistics: No Shortcuts to Security
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Getting the most out of your 3PL relationship
Join Evan Armstrong, president of Armstrong & Associates, as he explains how creating a balanced portfolio of "Top 50" global and domestic partners can maximize efficiency and mitigate risk.
Register Today!
EDITORS' PICKS
34th Annual Quest for Quality Awards: Winners Revealed
Which carriers, third-party logistics providers, and North American ports have crossed the service...
2017 Top 50 3PLs: Investment and Consolidation Maintain Traction
The trend set over the past few years for mergers and acquisitions has hardly subsided, and a fresh...

2017 Salary Survey: Fresh Voices Express Optimism
Our “33rd Annual Salary Survey” reflects more diversity entering the logistics management...
LM Exclusive: Major Modes Join E-commerce Mix
While last mile carriers receive much of the attention, the traditional modal heavyweights are in...