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

While the economy has seen more than its fair share of ups and downs in recent years, 2014 is different in that it could be the best year from an economic output perspective in the last several years. That outlook was offered up by Rosalyn Wilson, senior business analyst at Parsons, and author of the Council of Supply Chain Management Professionals (CSCMP) Annual State of Logistics Report at last week’s CSCMP Annual Conference in San Antonio.

Matching last week, the average price per gallon of diesel gasoline dropped 2.3 cents, bringing the average price per gallon to $3.755 per gallon, according to the Department of Energy’s Energy Information Administration (EIA).

A number of key topics impacting the freight transportation and logistics marketplace were front and center at a panel at the Council of Supply Chain Management Annual Conference in San Antonio last week.

The relationships between third-party logistics (3PL) service providers and shippers are seeing ongoing developments due in large part to the continuing emergence and sophistication of omni-channel retailing. That was one of the key findings of The 19th Annual Third-Party Logistics Study, which was released by consultancy Capgemini Group, Penn State University, and Korn/Ferry International, a global talent advisory firm.

Optimism in the form of increasing profits was a key takeaway in the Annual Survey of Third-Party Logistics (3PL) CEOs, released earlier this week at the Council of Supply Chain Management Professionals (CSCMP) Annual Conference in San Antonio.

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