Subscribe to our free, weekly email newsletter!

FTR Shippers’ Condition Index shows improving, but temporary, market conditions

By Jeff Berman, Group News Editor
June 20, 2011

While it may be temporary, shippers appear to be dealing with better business conditions than they did about a month ago, according to the recent release of the Shippers’ Condition Index (SCI) from FTR Associates.

FTR said the most recent SCI is at -5.4 percent compared to -11.4 in May, which was the worst SCI reading of this current economic cycle. The firm attributed the 6 point improvement to a slowdown in freight demand growth due to a lull in economic activity, as well as ongoing delays in Federal trucking regulations like driver Hours-of-Service (HOS).

The SCI is based on “all market influences that affect shippers,” with a reading of zero reflecting a solid environment and anything below zero reflecting an unfavorable environment.

“We are definitely in a soft spot in the economy,” said FTR Senior Consultant Larry Gross in an interview. “Recoveries never happen in a straight line. There are always going to be ups and downs and that is what is happening now. And there are also outside events like the Japanese Tsunami and earthquake, Libya and oil prices, and government spending that also has an impact, too.”

From a shipper’s standpoint, Gross stressed it would be unwise to plan against tight capacity and increased rates in coming months, as the SCI rebound is likely to be a very short-term affair.

Gross added that once the economy resumes a positive growth path it is likely that the SCI will again result in slower growth, due to trucking regulations taking hold and rates increasing through next year as fuel, equipment, and labor costs rise faster than the general rate of inflation.

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

There are so many ways to analyze the state of truckload capacity, and on top of that there is, perhaps, no other facet of freight transportation that is so directly impacted by myriad moving parts, whether it be driver availability, rates, demand, weather, the economy, and, of course, federal regulations, among others.

The ATA said that the annualized turnover rate for large truckload carriers, which it defines as truckload fleets with more than $30 million in revenue, increased 3 percent to an annualized rate of 87 percent in the second quarter.

If you want to meet some of the most ticked-off people on the planet, talk to any trucking industry retiree who received that letter from the Teamsters’ Central States pension plan notifying them of their potential financial haircut coming in retirement.

Global express delivery and logistics services provider DHL introduced a new flight geared towards Michigan-based importers and exporters out of the Detroit Metropolitan Airport.

With the sinking of the El Faro last week, and the resulting deaths of its entire crew of 33, the viability of the Jones Act is again being called into question.


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

© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA